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We find it truly extraordinary that anyone is surprised the financial system is under duress again.

My point with this is that when the capital markets “break” due to a loss in credibility, the shift tends to be both swift and violent. 

But at the end of the day, if your creditors lost faith in your ability to repay it… it’s GAME OVER. This is hitting the emerging market space today.

If we break below these... LOOK OUT BELOW.

Between 2008 and 2013, China’s credit market increased from $9 trillion to an incredible $23 trillion.

For gold to hit a new all time high adjusted for inflation, it would have to clear at least $2,193 per ounce. If you go by 1970 dollars (when gold started its last bull market) it’d have to hit $4,666 per ounce.

Market tops occur when investor psychology changes. But it’s not a clean shift. Investors, like any category of people, are comprised of numerous groups or sub-sects: some get it sooner than others.

Fod Gold to even realign based on the Fed’s actions, it would need to be north of $1,800. That’s a full 30% higher than where it trades today.

There are definite limits to what QE can do. Now that even Bill Dudley and other Fed officials admit that the Fed doesn’t understand QE, it’s only a matter of time before the market begins to crumble.

The Central Bank rig of the last five years appears to finally be ending.

 This doesn’t mean hyperinflation HAS to occur, but it is unlikely this situation will end well.

You can reflate a credit bubble in which spending rises briefly... But at the end of the day, all this does is set the stage for another economic collapse when people once again default on their credit card payments/ mortgage payments.

No cash= no dividends= no yield.

One of Warren Buffett’s greatest investment ideas concerned “economic moats.”

 If you’re going to buy stocks… make sure you get PAID.