Bob Janjuah Answers The Six Biggest Questions Heading Into 2012

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Sun, 12/18/2011 - 19:31 | 1992338 slaughterer
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Very complex analysis.  He covers most all contingencies.  

Sun, 12/18/2011 - 19:44 | 1992368 Oracle of Kypseli
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How about the great unwind of 1 quadrillion derivatives? Those could not go on forever.

Sun, 12/18/2011 - 22:00 | 1992660 Greg
Greg's picture

It will be interesting to see just how fast they do unwind.

Sun, 12/18/2011 - 23:26 | 1992926 AldousHuxley
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  • War over iran (covert or overt)
  • Euro dismantling or massive rescue
  • Chinese and Brazilian property bubble pop
  • US Fed printing more to get ready for election season (quid pro quo between ben and obama)


We will be back here again in 2012 december with same old problems....same kick the can bs....


politicians won't do anything until 2013

Euro battle will drag on.

Chinese and Brazilians will just eat up US dollar inflation to keep the bubble from popping...

Sun, 12/18/2011 - 20:34 | 1992422 WhiteNight123129
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The analysis is interesting but it fails to understand entropy, or the inability of certain processes to be reversible. Example a hurricane is a process which needs ever increasing amount of hot water to get strength, after a critical point it does NOT reverse, it crashes and loses strength abruptly. The variable of deleveraging is not a variable than is independent which has a positive or negative independent contribution. It is the fuel to the rest, it affects confidence and deleveraging is not the opposite or negative leveraging, it the failure of the system to tolerate more leverage, it indicates a critical point is reached. Think of a ball sitting on top of an n or hump instead of a ball sitting in a U. The ball sitting on top of the hump will end with extreme results, leverage promotes that (this is the fiat money system). On the other hand the Gold Standard forces short deviation from the center this is the ball sitting inside the bowl shape or the U. Janjuah confuses a return to an increase in leverage (the situation since the 1950s), with a mean reverting process of an absolute leverage constrained by the Gold standard. For many economist, mean reverting = return to increase in leverage, this is FREAKY!!!


Sun, 12/18/2011 - 21:45 | 1992643 Schmuck Raker
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Thanks for adding perspective.

Sun, 12/18/2011 - 19:34 | 1992343 chump666
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He missed the FACT that a full blown trade war is about to start as, wait for it...China attempts to send the Yuan lower. Why?  Because Chinese companies are buying up USDs like no tomorrow.  Why? Because China is sinking.  On Europe, it's a zombie economy that will go all MAD MAX if the ECB/IMF/EU whoever else starts printing like mad.  Oil is hedged against the EUR and net importers of oil such as Germany go into a stagflation recession.  A 2012 European nightmare.

Plays?  More (extreme) volatlity to straight selling.  IF the print jobs do nothing to send stocks higher

Sun, 12/18/2011 - 19:44 | 1992367 jomama
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minor oversight.

Sun, 12/18/2011 - 19:45 | 1992370 chump666
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and he gets paid more than me...

Sun, 12/18/2011 - 21:26 | 1992620 Davilis
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I think that falls under "policy mistake".

Sun, 12/18/2011 - 19:39 | 1992354 ebworthen
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The markets have not discounted the reactions of individual households.

Sun, 12/18/2011 - 19:44 | 1992366 RobotTrader
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If the U.S. is already 2/3 the way through the crisis...


And the U.S. retail stock indexes are barely off 3-year highs, still up more than 90% off the March 2009 lows.

What does that tell 'ya?

"But any minute now, I swear, the system is going to implode, gold is going to $5,000, oil is going to $300, gas lines, riots, hyperinflation, runaway interest rates, etc. everywhere!"

Sun, 12/18/2011 - 20:12 | 1992405 Urban Roman
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Interesting how the volume tapers off to nothing as you move toward the right end of that chart.

Sun, 12/18/2011 - 20:16 | 1992411 Caviar Emptor
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Yes. We're actually totaly through the crisis because...people still shop and eat out. That's why stocks are near all-time records. With the screaming economy, they should sky higher and higher because everything is really cheap. And by quick math, if we're 90% off the lows now, we should be 900% off the lows within 10 months. Give or take. 

Now what does that mean for the average investor? It means you better wait till the next market collapse to get in. It's kinda late in the day now.

Sun, 12/18/2011 - 20:22 | 1992417 GMadScientist
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When the Bernank has sold his MBS, and banks can tolerate non-zero interest rates, and banks mark their 'folios to market, and banks put their derivatives on exchanges, and traders don't need dramamine to stay on the newsflow bronc ride, then, and only then, can you do a touchdown dance.

Way to calibrate against the norm by cherry-picking a trough, knucklehead.

Why not say it's only down 22% from the highs of 2007?



Sun, 12/18/2011 - 21:02 | 1992552 jcaz
jcaz's picture

And yet, Robo, you're 5/3 the way thru your paper trading account value.....

Sun, 12/18/2011 - 19:48 | 1992375 NumNutt
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I would suggest buying gold, then taking it to your dentist and telling him to cap all your teeth with it. That way you will always know where it is. Then drive directly from your dentist office to the local gun dealer and invest in a good weapon and some ammo....You don't want to wake up with no teeth...

Sun, 12/18/2011 - 21:04 | 1992550 ebworthen
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Gold teeth, Aye!

Sun, 12/18/2011 - 21:52 | 1992649 Schmuck Raker
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LOL - "You don't want to wake up with no teeth..."

That's what I was thinking at the first sentence of your post.

So, you're not advocating burying it where no-one can find it? :D

Sun, 12/18/2011 - 22:18 | 1992672 s2man
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Gold is inert. How about having it implanted beneath your skin? If anyone asks, you can tell them its a pacemaker.

Sun, 12/18/2011 - 19:49 | 1992379 WineSorbet
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2/3rds through? Pray tell, what has been worked out? Nothing!

Sun, 12/18/2011 - 19:55 | 1992385 JR
JR's picture

Actually anyone can be as far along as he wants if all he needs to do is say it; and while Janjuah's making things up, why not just say full recovery; case solved?

Sun, 12/18/2011 - 20:50 | 1992484 WestVillageIdiot
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That is how I saw it.  What a joke.  House prices in some areas are still way too high.  Bad debts have not been written off.  Local governments need to continue to cut.  State pension bombs are ready to go off in all of the biggest, and most unionized, states.  The federal deficit continues to be completely out of control. 

What in all of that points to being 2/3 of the way through this mess? 

Sun, 12/18/2011 - 22:40 | 1992720 kito
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@winesorbet-it must be like two thirds of the way through a nuclear chain reaction...

Sun, 12/18/2011 - 19:51 | 1992382 mtomato2
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It seems that I tried to go to Zero Hedge and got redirected to MarketWatch.

Sun, 12/18/2011 - 20:03 | 1992395 Stagflationary
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According to Bob Jajajajajajajaja the SPX should already be a -3000. 

Show us the crash, Bob, or find yourself a real job.

Sun, 12/18/2011 - 20:51 | 1992488 WestVillageIdiot
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You could have said, "go home and get your fuckin' shine box, Bob". 

Sun, 12/18/2011 - 20:10 | 1992396 Newager23
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Business cycle? You can throw out history. The business cycle is gone. Why? This is a new era we are entering. America and Europe are on the precipice of a major downward spiral with increased permanent unemployment and a reduced standard of living. Expect higher prices for food and energy, and lower prices for assets.

I'm not sure if this will begin 2013 or 2014, but we are getting very close. I don't like to give bad news, but you need to get prepared, and it is time to begin rethinking the idea that our way of life is going to carry onward in the near term.

The populace is being lulled into believing this is just another economic hicup in the business cycle, and that growth is just around the corner. That is highly unlikely. The Western world of America and Europe which make up 50% of the global GDP are broke and cannot grow due to high energy prices and excessive debt. Many smart people think that human ingenuity can overcome this situation. It's not likely to happen.

How do I know this? You wouldn't believe my sources, but many other smart people are coming to the same conclusion. I've been studying the future since 1989 and I have written several books that explain the coming transformation of humanity. The simple fact is that we have ran out of resources for our growth based global economy. Everyone can't own a car, and everyone can't own a house. There simply is not enough energy to provide that kind of standard of living for everyone.

To give you an idea of the limitations we face, if China were to obtain the same ratio of cars to people that exists in Mexico, we would need something like an additional 15 million barrels of oil produced on a daily basis. That's not going to happen. We have been stuck at around 72 million barrels per day since 2005, and we stopped finding oil in significant quantity around the year 2000.

America and Europe are bankrupt, yet we continue to borrow as if we were solvent. That game of rolling over and extending debt is on its last legs. When it hits a wall, we are going have major changes to our economic system. What these changes will be is difficult to foresee. But the fallout will be negative and economic growth will drop dramatically. I expect the GDP of both Europe and America to fall around 25% in the medium term (3-5 years), and 50% in the long term (5-10 years).

There is only one way to protect yourself financially and that is physical gold and silver. And if you want to speculate on gold and silver stocks, go here:



Sun, 12/18/2011 - 20:21 | 1992416 gringo28
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you got the first two paragraphs right, generally speaking. the rest, uhhhhh. it's actually more like Carter^2 or ^3. it's going to get a little ugly and we'll see spikes in crime but it's not apocalyptic. why? because the principal liability will expire as it boomed. the real question is can the sheeple wake the fuck up next year and get this ass clown out of office so we can stop focusing so much on gubmint?

any politician who spends so time thinking about himself in relation to past politicians ought to be thrown out for that simple tendency.

Mon, 12/19/2011 - 06:34 | 1992443 WhiteNight123129
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It will be worse way worse than the 70s. The only Silver lining is coming from material science revolution. Material science revolution will make computer science look ver pale in terms of achievements. But first a huge shit sandwhich. Consider also that Fiat was a huge invisible drag on the economy. The economy and median wealth would be much larger if we had not used a system which massively misallocates capital. Look at Hong-Kong growth, it beats everybody and it is a non fiat system.


Sun, 12/18/2011 - 20:55 | 1992513 WestVillageIdiot
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"Le business cycle, c'est moi."
-  Ben Bernanke

Sun, 12/18/2011 - 21:31 | 1992632 fnord88
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Broadly agree, the black swan in your analysis is global population. If 3 billion people die, energy problems are solved, and gold and silver go into the toilet. At that point though, it's not going to matter.

Sadly, I don't think that senario is completely off the table. There are too many people for TPTB to contain, and I find it hard to believe they haven't war gamed some kind of "lets kill 1/2 the planet" plan.

Sun, 12/18/2011 - 22:04 | 1992663 bobert
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A clean weapon would be necessary, no?

Sun, 12/18/2011 - 22:10 | 1992666 fnord88
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There must be some pretty sophisitcated bio weapons floating around by now. Kills everyone who doesn't have stone mason genes?

Sun, 12/18/2011 - 20:10 | 1992400 G-R-U-N-T
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Golds Rise 2012....No question here just Ecstasy!

Sun, 12/18/2011 - 20:17 | 1992412 Mr. Magniloquent
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I'm sorry. I got lost at, "With the US two-thirds of the way through the post-crisis workout phase...". Does the path to solvency consist of more debt and malinvestment? How about the addition of more inappropriate regulations and government largess? My guess is that the last third of the process is default. Then again, I'm not a professional economist, nor a Keynesian.

Sun, 12/18/2011 - 20:31 | 1992424 JR
JR's picture

and the one-third post-crisis bad-news phase still to work through… What Will 2012 Bring? by Gerald Celente |"Wake-Up Call" Trend: The Decline of America trend is nowhere near bottom, and the worse is yet to come.

One year later: "Worse" has happened, as the country piles up more and more debt, politicians are gridlocked, paralyzed in some perpetual political traffic jam of inaction.

"Crack-Up 2011" Trend: Teetering economies will collapse, currency wars will ensue, trade barriers will be erected, economic unions will splinter…

One year later: The Sovereign debt crisis threatens both the European Union and Euro, currency wars are underway and the US and China are trading trade barbs.

"Crime Time" Trend: No job + no money + compounding debt = high stress, strained relations, short fuses. Hardship-driven crimes will be committed across the socioeconomic spectrum by legions of the on-the-edge desperate who will do whatever they must to keep a roof over their heads and put food on the table.

One year later: Thieves are stealing copper piping and cables, cooking oil and temple donation boxes; "Criminal recycling" is flourishing; in 2011 a record number of cyber crimes is reported to the FBI: more than 23,000 per month.

"Screw the People" Trend: As times get even tougher and people get even poorer, the "authorities" will intensify their efforts to extract the funds needed to meet fiscal obligations.

One year later: In the two-tier American justice system, the long arm of the law only reaches down to the low hanging fruit. Banks are slapped with slap on the wrist fines for billion dollar crimes, and like Jon Corzine, no crime time. But swift justice is readily dealt out for small time crimes. From closing down lemonade stands operating without a license to swat teams busting raw foods cooperatives, in America, Justice means "just us!"

"Students of the World Unite" Trend: "University degrees in hand yet out of work, in debt and with no prospects on the horizon, young adults and 20-somethings are mad as hell, and they’re not going to take it anymore."

One year later: Occupy Wall Street is just one of the scores of worldwide student protest movements, some of which have proven powerful enough to bring down governments.

"Crackdown on Liberty" Trend: A national crusade to "Get Tough on Crime" will be waged against the citizenry. And just as in the "War on Terror," where "suspected terrorists" are killed before proven guilty or jailed without trial, in the "War on Crime" everyone is a suspect until proven innocent.

One year later: TSA strip searches of little old ladies; Obama backs bill "authorizing indefinite military detention of U.S. citizens." 

"Journalism 2.0" Trend: With its unparalleled reach across borders and language barriers, "Journalism 2.0" has the potential to influence and educate citizens in a way that governments and corporate media moguls would never permit

One year later: Aleksai Navalny, an imprisoned young Russian blogger/Twitterer with some 200,000 followers, is "credited with mobilizing a generation of young Russians through social media, a leap much like the one that spawned Occupy Wall Street and youth uprisings across Europe this year."

"Cyberwars" Trend: The demonstrable effects of Cyberwar and its companion, Cybercrime, are already significant – and will come of age in 2011. Equally disruptive will be the harsh measures taken by global governments to control free access to the web, identify its users, and literally shut down computers that it considers a threat to national security.

One year later: Iran proudly displayed a sleek, white U.S. drone that was used for spying on Iranians; Iranians were able to capture what US military officials privately told Bloomberg was a Lockheed Martin RQ-170 by hacking into its security code; PayPal shuts off service to WikiLeaks.

Sun, 12/18/2011 - 20:33 | 1992426 slewie the pi-rat
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Q6: how tf did the Lions pull that off?
A: the raiders gave them all the help they needed!

Q7: is the NFL as bad as congress?
A: move along, please; nothing to see, here

Q8,8a: the packers lost? to KC?
A: yup! obviously, the MIB erased their receivers' memories of how to catch the football

Sun, 12/18/2011 - 21:02 | 1992554 WestVillageIdiot
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The Colts won and both New York teams got spanked.  That is a good day. 

Sun, 12/18/2011 - 21:18 | 1992608 bobert
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The Bronco's were also not faring well the last I checked.

Their defensive team did not show up.

Good distraction Pirate, I appreciate it.

Regarding, however, the topic at hand. I don't think I want solutions. I'm enjoying the rich trading environment too much.

Sun, 12/18/2011 - 20:41 | 1992437 Srgato
Srgato's picture

Remember, this is just a one-year forecast.  He's not saying that everything will be all happy ever after.  It seems likely to me that the U. S., in particular, will muddle along (it's even getting to be a popular locution) for a year.  The stock market will go up and down and gold will, too.  This is pretty much a consensus view.  He's not saying that this is the final, endgame scenario, at least for the U. S.  And, he does say that it will make a lot of difference if the U. S. gov't begins to cut back on spending and bureaucracy.  He doesn't say that (even if we're 2/3 of the way to something) things can't turn around and get worse.  He's just saying, like his metaphor of the supertanker turning 180 degrees, that over the next year things will continue to play out slowly and contain possibilities for improvement. 

Much better comment box, thanks ZH. 

Sun, 12/18/2011 - 20:57 | 1992530 youLilQuantFuker
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60 minutes tonight confirms that the banks are colluding with municipalities to shore up housing. Instead of the banks giving the homes away for free, they are allowing municipalities to buy the properties(using tax dollars) at auction, and then the muni's are paying a demolition company 10,000-15,000 to demolish the home.

Disgraceful. Give it away for free. Someone will take it and fix it.

I'm sure Bennie and the MBS buying crew have a mathematical formula that says (x) percent have to be demolished in order to firm up the supply side.

Disgraceful Cleveland. Just fucking disgraceful!

Sun, 12/18/2011 - 21:06 | 1992566 Caviar Emptor
Caviar Emptor's picture

The final irony will be: in their zeal to control house prices by reducing inventory they will find themselves caught between rising new building costs (raw materials, energy, taxes etc) plus prohibitive home ownership costs and plunging individual net worth and incomes. So they'll have to set prices below cost to or bulldoze the new houses again. 

Sun, 12/18/2011 - 21:17 | 1992604 youLilQuantFuker
youLilQuantFuker's picture

round and round we go. lol.

Sun, 12/18/2011 - 22:32 | 1992696 s2man
s2man's picture

That Old Black Magic. Though I watched Jerry Lewis sing it tonight, classic Louis Prima pops into my head;

Down and down I go,

Round and round I go,

In a spin...

Sun, 12/18/2011 - 21:04 | 1992567 WestVillageIdiot
WestVillageIdiot's picture

I didn't see it but can you imagine if municipalities are allowed to give houses away?  Can you imagine the corruption that this would breed?  I am sure we would be shocked to see cousins, brother-in-laws and shell corporations setup by the political gangsters getting the preferential treatment. 

Sun, 12/18/2011 - 21:19 | 1992599 youLilQuantFuker
youLilQuantFuker's picture

I understand what you are saying.

What I'm suggesting is the bank cannot buy back at the auction. If the bank puts a property up for sale on the courthouse steps it should sell to the highest bidder if and only if the bank is not the bidder on it's own lot.

Currently these faux auctions allow the banks to bid the price up and buy back the property. This should be illegal.

I don't even go to courthouse auctions anymore they're a complete waste of time.

It's all a game anyway. Fuck these asswipes.

Sun, 12/18/2011 - 21:03 | 1992555 Winston Smith 2009
Winston Smith 2009's picture

"With the US two-thirds of the way through the post-crisis workout phase"

This is the only "workout" that counts and it has hardly begun with most of the reduction in the US coming from forced defaults:

7 Jul 2011

You ain't seen nothing yet
The process of reducing the rich world’s debt burden has barely begun

Graph "Total Credit Market Debt as Percent of GDP"

Sun, 12/18/2011 - 21:20 | 1992609 FoieGras
FoieGras's picture

Good old Bobbie... still a fuzzy haired bear. Both visually and strategically. Look we all know we're headed for the toilet. The question is not if we're headed for economic trouble. The question is what signs to look for when to buy. Junjah never gets to that question -- which is what makes you money. He just keeps yelling fire without pointing to the loot once the fire has run its course. And there's going to be plenty of loot for those with buying power left.

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