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Richard Maybury's Emergency Letter via Early Warning Report

Discussion in 'Historic Market Crashes' started by HistoryStudent, Aug 25, 2015.



  1. HistoryStudent

    HistoryStudent Midas Member Midas Member

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    I believe the financial markets in recent weeks have been signaling a depression. Not a recession, a depression. Here’s the story.

    The present mess in the markets is more evidence that my April 2015 article, “Mechanical Systems are Kaput,” was correct. Governments have so fouled up the world economy and financial markets that we must each put our money in the hands of advisors who can keep an eye on things day to day and hour to hour, and make changes to our portfolios as the results of the ever shifting political lunacy become known, as now.

    The advisors I use to do this financial broken field running with my own money are Martin Truax, Ron Miller and Josh Newman at Raymond James in Atlanta (770-673-2177). I’ve been talking with them, and I’m convinced they are doing all anyone can to cope with the chaos governments have created.

    A crucially important point I’ve been discussing with them is one the mainstream press seems to be ignoring.

    If you look back over the past year, what do you see as the standout political trend all over the globe?

    Devaluations. This was explained in the March 2015 EWR. Here are some of the currencies that have been devalued so far: Chinese yuan, Canadian dollar, European euro, Japanese yen, Swedish krona, Mexican peso, Australian dollar, New Zealand dollar, Turkish lira, Brazilian real, Colombian peso, Russian ruble.

    When a government devalues its currency, its exporters get an immediate boost, as the prices of their products become instantly cheaper to foreigners.

    Consumer prices do not jump immediately, however, because importers are afraid to raise their prices, for fear of losing business; they delay as long as they can. So there is a sweet spot, or window, between a devaluation and a rise in consumer prices. In this sweet spot for some months, things look better.

    The governments of the above named currencies are trying to buy time by creating these temporary sweet spots.

    When malinvestment begins to surface, investment markets crash, as prices of assets are adjusted to reflect the newly recognized “mal.” That’s what is happening now.

    I believe that, like the officials of the governments that have already devalued, US officials have been interfering in the economy for so many decades that they have only one arrow left in their quiver, devaluation.

    My guess is that they have their eyes set on the elections. They will devalue the dollar with whatever timing and magnitude they think will create a boost for exports before the elections, with the rise in prices delayed, at least to some extent, till after the elections.

    A crucial point to focus on right now is, if you bail out of your investments and go into US dollar cash or other US dollar-denominated assets, such as Treasuries or bank CDs, what will happen to the value of your money if Washington suddenly devalues the dollar?

    It could drop very quickly. That’s what happened when Nixon suddenly devalued in 1971. My wife and I bought a new (imported) Volvo just before the devaluation, for $4,000, and if we had waited just a few weeks longer, it would have cost $4,400. So, in terms of imported goods, in just those few weeks, US dollars lost ten percent of their value.

    And, the dollar continued falling for the rest of the decade. By 1980, a similar Volvo was $11,000.

    Today I believe we are back to where we were in 1971, which was the last time US officials had used up all their arrows except the devaluation one.

    Governments have once again plunged the world into chaos. Financially, there is no safe place to hide, and I plan to let the team at Raymond James do the broken field running I hired them for.

    One simple piece of long-term advice I can give everyone, which I’m sure will hold for at least a few years is, own precious metals and other assets that cannot be created out of thin air, as currencies can, and be reluctant to own more US dollars. (For precious metals I recommend Van Simmons at David Hall Rare Coins, 949-567-1325.)

    Incidentally, neither I nor anyone else at Henry Madison Research receives kickbacks, commissions or fees of any kind for recommending brokers, dealers, investments or publications. We work for our subscribers, and no one else.

    The world is back to the 1970s. Governments are kicking the can down the road in the only way they have left, devaluation. You, my subscribers, are on my mind continually, and I wish you all the best.

    Warm regards,
    Richard J. Maybury
    Early Warning Report
    (800)509-5400 (602)870-9329 Fax (602)943-2363
    Office Hours M - F 7:00 am to 5:00 pm MST
    service@earlywarningreport.com
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    DYODD - HS

    GOTS! or it is foolish GUTS if don't got GOTS!
     
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  2. platinumdude

    platinumdude Gold Chaser Platinum Bling

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    I'm doing a portion in metals and a portion in cash. I think metals can still go down some more. If worse comes to worse and there is no metals to buy and inflation starts to rise, I will get a truck or something and give some away.
     
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  3. solarion

    solarion Gold Member Gold Chaser

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    Think we've been in a depression for some while and the busloads of cooked up numbers, cheap credit, fed actions, and goobermint transfer payments have been masking the carnage.
     
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  4. Ahillock

    Ahillock A nobody Mother Lode

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    Am I the only one that smells QE4 around the corner (official and in the public QE4).
     
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  5. Treasure Searcher

    Treasure Searcher Gold Chaser Platinum Bling

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    Better yet, get a boat. Boating accidents are a sure thing for those on GIM!
     
  6. HistoryStudent

    HistoryStudent Midas Member Midas Member

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    Since REALLY apparent 2008; and even before that...

    You are 100% RIGHT.


    Shadowstats.com proves out your thought pattern.
     
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  7. HistoryStudent

    HistoryStudent Midas Member Midas Member

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    Probably mixed with this debt default called GREATEST CRACK-UP CREDIT BUST BOOM the world ever saw - or something like that...

    stagflation too.

    Things you need to live INFLATE against your income - things you don't need get DEFLATED against your income.


    ENDURABLE's count things that last like Ocean Front or huge farm real estate; crown jewels like slabbed numismatics if you are an expert "ish" type -
    at least P.Ms. (Au Ag Pt) - and be super prepared.
     
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  8. Goldhedge

    Goldhedge Modal Operator/Moderator Site Mgr Site Supporter

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    I smell QE4EVER myself...
     
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  9. HistoryStudent

    HistoryStudent Midas Member Midas Member

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    So does he...

    Posted August 25th, 2015 at 6:43 PM (CST) by Bill Holter & filed under Bill Holter.

    Dear CIGAs,

    When planning to write this piece, the Dow was up 250 points or so with 45 minutes of trading left. The anticipated bounce (if China cut rates) arrived this morning with a 442 point upward thrust. This on a report card could be categorized as a “C-” or even a “D+”, very poor in my estimation. As I sat down to write the Dow was up 24 points and turned negative before I wrote the first word! This is HORRIBLE ACTION and outright scary if you are a Bull! The PPT (plunge protection team) got their butts kicked for the third or fourth day running. To let the market give up 500 points in just one hour shows their weakness or lack of capitalization. Many will look at today’s close and say “UH OH”!

    What will this mean for tomorrow? We first have to see what happens tonight in the Asian markets and in particular China …which I suspect the big money brokers have already done. Somehow, my guess is they already sense a rout in Asia and this is the reason for the abrupt turnaround to front run another big dump tomorrow. The bounce was weak, it turned negative and closed at the worst levels of the day …NOT exactly that warm fuzzy feeling! “Look out below” seems to now be a continuing theme.

    To reiterate what I’ve written over the last few days, this is all about the Great Credit Unwinding. It is my belief the players are beginning to sense this. Lower rates did nothing to fix Japan’s economy for 25 years, it has done less than nothing in aiding the U.S. economy for the last 8 years …why will it do anything for China? So far China has used versions of the Western playbook to thwart the rout. They have outlawed short selling, made it illegal for many institutions to sell and the PBOC has overtly come in to support the markets… to no avail!

    This is really scary folks, even the most bearish expected a better bounce than we got today. What happens tomorrow if Asia/China get no bounce at all? The Fed has no room to lower rates, neither does the ECB. To be a central bank(er) and to get no “respect” from the markets is the most terrifying event one could think of.

    Digging deeper, what do you suppose has happened over the last few days in the derivatives arena? There have been HUGE gains and losses in the $trillions or even $10′s of trillions! Notice I wrote “gains and losses”? How would you like to be an institution with a losing position of some sort …hedged so there would be no loss …only to find out your counterparty cannot pay? Do you suppose this might have already happened? I can almost guarantee it already has and in many different markets, we just haven’t heard about it nor “who” died. In reality, it doesn’t matter “who died”. Just as someone drowning hangs on to their rescuer, the derivatives chain is connected from start to finish and loops back where the “start connects with the end”. In other words, when losers cannot pay, the gleeful winners get the bad news they are also losers. If one drowns, they all drown!

    I also mentioned yesterday it would be good to monitor interest rates. The 10 year yield was as low as 1.9% yesterday and as high as 2.13% today. I believe the panic number will be 2.4%. Should this yield level give way (and you will hear it spun as “good” on CNBC), it will signal major central bank selling (led by China) overwhelming the Fed’s ability to sop up the selling. Time will tell but this is something I will continue to monitor.

    The overleveraged world is experiencing deflation. “Beggar thy neighbor” by central banks to increase trade at the expense of other nations is the game. The “game” by the way is a static or shrinking (global GDP)! This is a no win strategy on a global basis because someone has to lose …and then you have the same scenario as in derivatives. Sovereign nations will default! The point is this, “losses” which have been hidden so far will need to be booked and realized. There are NO BALANCE SHEETS left, strong enough to absorb the losses! The Fed commencing another round of QE is now a lock. Outright monetization will be sniffed out and the current outsized demand for gold and silver may double or more …just as inventories and vaults in the West are running out.

    Lastly let’s look at the dollar. Commodities including oil are being sold …for dollars. Demand for product is down and so is “price”. The petro dollar cannot function with 60% haircuts in dollar usage. This acts to also lessen velocity of dollars. A very bad combination for any Ponzi scheme, less demand and lower velocity. The previous “good” leverage reverses and comes down on itself. In this instance, the world’s reserve currency loses acceptance for the very reason “safety capital” should flock to it, deflation! Can you see this? The dollar cannot survive with deflation because not enough new money comes in to prop it up. The dollar MUST have inflation, without it, it dies. Today’s dollar is not the 1930′s dollar, pegged to gold that was deflation proof. The foundation then was gold. Today the dollar’s foundation is nothing more than debt, TOO MUCH DEBT! In fact, dollars are only promises …to pay you more dollars! The perfect financial storm? Yes. There is still time (probably very little) to get your affairs and positions in order. I pray anyone reading this does so!

    Standing watch,

    Bill Holter
    Holter-Sinclair collaboration
    Comments welcome! bholter@hotmail.com
     
  10. Aurumag

    Aurumag Dimly lit. Highly reflective Midas Member Site Supporter

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    The depression began on November 14th, 2007 to be exact, and I wish I could find the article in which the fed member banks declared insolvency on that day.
     
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  11. Aurumag

    Aurumag Dimly lit. Highly reflective Midas Member Site Supporter

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    The term QE4Ever is credible, catchy and very quotable!
     
  12. Ebie

    Ebie Midas Member Midas Member

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    Gold is down.
    Including physical gold.
     
  13. Ebie

    Ebie Midas Member Midas Member

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    "US officials have ... have only one arrow left in their quiver, devaluation"

    How can they devalue the dollar?
    Do they set official rates vs the Euro?
     
  14. Ahillock

    Ahillock A nobody Mother Lode

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    A few ways. Devalue against gold (raise price of gold). Or cut the value of the USD. By creating a new external/international USD and an internal/domestic USD that you devalue by x%. Say 3 old USDs is equal to 1 new USD.
     
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  15. Uglytruth

    Uglytruth Gold Member Gold Chaser

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    Thinking back to 19+71 that means huge interest rates numbers are still about 8 years away........
     
  16. Tecumseh

    Tecumseh Silver Member Silver Miner

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    Print more of them.
     
  17. Ebie

    Ebie Midas Member Midas Member

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    Print more dollars?
    That is "urgent" news?

     
  18. Unca Walt

    Unca Walt Midas Member Midas Member

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    Quote Originally Posted by Ebie


    How can they devalue the dollar?


    Ebie: Chrissake, man... where ya been? Lookit the NotGeld Reichsmark, the Pengoe, the Bolivar, Zimbabwe dollar, and fifteen other while YOU have been alive.

    ALL OF THEM WERE DEVALUED BY PRINTING PAPER.

    [​IMG]

    100,000,000,000,000

    We are going thisaway FAST.
     
  19. Ebie

    Ebie Midas Member Midas Member

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    Unca!
    This is not an overnight announcement by a gov't that the official rate has changed.
    The dollar floats.
    And they have been printing them for a long time.
    But the printed dollars seem to have near zero velocity.
    So no strong inflation.

     
  20. Krag

    Krag Planet earth Platinum Bling

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    Last edited by a moderator: Dec 26, 2015
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  21. HistoryStudent

    HistoryStudent Midas Member Midas Member

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    It's all about those trillions and trillions of PETRO dollars coming home since 1971. That's why Brother King of Saudi is SOON visiting Mr. "O" to
    tell him the Petro Dollar deal is KAPUT!

    The job is done...
     

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