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87% Chance of Stock Market Crash By End Of Year

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George Soros dumping 80% of his stock holdings might give a clue towards a stock market crash this year. The article below from Market Watch estimates a 87% probability with 10 predictions, but never underestimate Bernanke and the Fed to keep the show going. One thing is for sure its just a matter of time and will far worse than anything experience in 2008. You were warned.

In “Stocks for the Long Run,” economist Jeremy Siegel researched all the “big market moves” between 1801 and 2001. Bottom line: 75% of the time, there is no rationale for “big moves.” No one can predict them. Maybe technicians and traders can pick short-term moves the next second. Maybe tomorrow. But the long-term “big market moves?” No way.

So why predict an “87%” chance of another meltdown in 2013? Because in the real world of statistical probabilities, historical facts and expert opinions danger signals are flashing wild. In mid-2008 we summarized the predictions of 20 experts over several years. Predicted a meltdown in a few years — markets crashed two months later. Fast.

In retrospect, it was inevitable, thanks in part to the hype, arrogance and incompetence of Fed Chairman Ben Bernanke and Treasury Secretary Henry Paulson who failed to prepare America.

The warnings are again accelerating. And so is the happy talk from Wall Street casino insiders, about rallies, housing recoveries, perpetual cheap money. Don’t listen. The next crash will happen by year-end.

Yes, there’s a 13% chance the next Fed chairman will keep printing cheap money into 2014. But on New Years Eve our aging bull will be 4½ years old, well past Bill O’Neill’s “average” 3.75 years for putting this bull out to pasture.

So unless you’re shorting, all bets on Wall Street casinos for 2014 are megarisk, like 2008. Like a Stephen King horror film, you feel it coming. Could happen anytime, even tomorrow, says Siegel’s research, or the unpredictable logic in Nassim Taleb’s “Black Swan.”

Here are 10 other predictions adding credibility to a crash by the end of 2013:

1. Warren Buffett ‘guaranteed’ new bubble, new recession four years ago

Actually he saw it coming early. Shortly after the 2008 crash Warren Buffett was asked: “Do you think there will be another bubble leading to a huge recession?” Yes, “I can guarantee it.” Cycles happen.

Next question: “Why can’t we learn the lessons of the last recession? Look where greed has gotten us.” Then with the impish grin of a Zen master, Uncle Warren replied, “Greed is fun for a while. People can’t resist it.” But “however far human beings have come, we haven’t grown up emotionally at all. We remain the same.”

Yes, one of world’s richest men was personally guaranteeing another bubble, another “huge recession.” Now, four years later, that time bomb is ticking louder, closer.

2. Federal Reserve’s Council: ‘Unsustainable bubble in stocks, bonds’

The International Business Times just reported on the minutes of the Federal Reserve Board Advisory Council’s mid-May meeting. Members expressed “strong concerns over the Fed’s low-interest-rate policies and its bond-purchase program, which they say could trigger unmanageable inflation and an ‘unsustainable bubble’ in the stock and bond markets.” Some “pointed out that near-zero interest rates could not be sustained in the long run.”

Why? “A spike in inflation could force the Fed to hike interest rates, hurting business confidence and consumer spending, and prove disastrous to the U.S. economy, which is still clawing its way back from the debilitating effects of the 2008 financial crisis.”

Get it? The Fed and Wall Street insiders hear something’s dead ahead.

3. Peter Schiff is ‘doubling down’ on his ‘doomsday’ prediction

Euro Pacific Capital CEO Peter Schiff, author of “The Real Crash: America’s Coming Bankruptcy,” is “not backing away from doomsday predictions about the U.S. economy,” wrote MarketWatch’s Greg Robb last week. He sees the no-win scenario: “Either the Fed stops QE and starts selling the Treasurys and mortgage-related assets on its balance sheet, thus triggering a recession, or else faces an inevitable, even-worse, currency crisis.”

The “idea that the U.S. economy is in recovery is based entirely on rising asset prices … Asset prices are only rising because rates are low. As soon as rates go back up, asset prices will” fall.

Last year on Fox Business Schiff warned: “We’ve got a much bigger collapse coming.” Then last week: “I am 100% confident the crisis that we’re going to have will be much worse than the one we had in 2008.” His 100% beats our 87%.

4. Bill Gross: ‘Credit supernova’ turning 2013 bull into big bad bear

Yes, Gross sees a ‘credit supernova’ dead ahead. His firm has $2 trillion at risk when the Federal Reserve cheap money finally explodes in America’s face, brings down the economy, again. Gross warns: “Investment banking, which only a decade ago promoted small-business development and transition to public markets, now is dominated by leveraged speculation and the Ponzi finance.”

Bernanke’s Ponzi finance is self-destructive, lethal and massive. Endless cheap money upsets the balance between credit expansion and real economic growth, resulting in diminishing returns. Very bad news.

5. Gary Shilling predicts the ‘grand disconnect’ will trigger ‘shocker’

Yes, economist Gary Shilling predicts a “shocker” before the end of the year. Worse because investors are “paying little attention to weak and declining economies around the world, and concentrating on the flood of money being created by central banks.”

The “grand disconnect” is driving up stocks “while the zeal for yield, amidst low interest rates, benefited junk bonds and other low-quality debt.” Wall Street’s blowing a nasty new bubble, repeating the run-up to the 2008 crash.

6. ‘Kaboom ahead,’ an ‘ominous third phase’ of 2008 Meltdown

“Bond guru buying stocks. Sees ‘Kaboom’ Ahead,” shouted the Bloomberg Market headline about Jeffrey Gundlach, CEO of Doubleline Capital. Earlier he predicted the 2008 meltdown. But now he says the real damage is yet to come.

“The first phase of the coming debacle consisted of a 27-year buildup of corporate, personal and sovereign debt. That lasted until 2008.” Then cheap money “finally toppled banks and pushed the global economy into a recession, spurring governments and central banks to spend trillions of dollars to stimulate growth.” Next, an “ominous third phase,” a bigger crash, whose impact will far exceed the damage of 2008.

What’s he buying? Hard assets. Plus “sitting on cash,” waiting to scoop up more at “fire-sale” prices, “it’s worth waiting.”

7. ‘Tick, tick … boom!’ InvestmentNews sees bond crash dead ahead

A few months ago InvestmentNews front page is so powerful you can hear sirens on a flashing, warning in huge bold type: “Tick, tick … boom!” Their readers: 90,000 professional advisers who trust INews forecasts.

This was the biggest warning since 2008: “What will your clients’ portfolios look like when the bond bomb goes off?” Not “if” but “when.” Yes, they expect the bond bomb to explode soon.

Wake up, INews sees extreme dangers for millions of Americans who have “no idea what’s about to happen to them … Tick, tick … boom!”

8. Reagan’s budget director sees an ‘apocalypse … get out now’

Recently David Stockman warned of an economic “apocalypse” dead ahead, “arising from a rogue central bank that has abetted the Wall Street casino, crucified savers on a cross of zero interest rates and fueled a global commodity bubble that erodes Main Street living standards through rising food and energy prices … get out of the markets and hide out in cash.”

Stockman’s not merely warning of a crash ending the bull rally since 2009. This “grand bubble” has been building for 32 years since the Reagan revolution. He’s atoning for a generation of politicians with no moral compass: “Capitalism has morphed into a monopoly ruled by politicians who are serving a wealthy elite. Competition is a joke.”

9. Nouriel Roubini: ‘Prepare for the perfect storm’ in an unstable world

Yes, prepare, prepare, prepare. Roubini told Slate.com: Our world is a game of dominos, any one of which could put in motion a global collapse: “Sooner or later, another ugly fight” over debt, markets will “become spooked” with “a significant amount of drag … on an economy that has grown at barely a 2% rate.”

Scanning the world’s hot-button triggers in the euro zone, China, BRICs, Iran, Middle East, Pakistan, oil markets, Dr. Doom warns, the “drums of actual war will beat harder.” Any one of these trends “alone would be enough to stall the global economy and tip it into recession.”

10. Jeremy Grantham: America’s growth and prosperity ‘gone forever’

Grantham’s GMO firm manages $100 billion. He focused on Richard Gordon’s disturbing research: “Is U.S. Economic Growth Over?” Yes, says Grantham, “the U.S. GDP growth rate … is gone forever.”

For centuries before the Industrial Revolution growth was under 1%. Then the growth trend till “1980 was remarkable: 3.4% a year for a full hundred years,” driving the American dream. “But after 1980 the trend began to slip,” says Grantham,“ by over 1.5% from its peak in the 1960s and nearly 1% from the average of the last 30 years.” By 2100, America’s GDP growth will fall back to where it started before the Industrial Revolution, to an annual rate less than 1%.

Buffett guarantees … Schiff doubles down … Gross sees supernova … Shilling’s grand disconnect … Gundlach’s ominous third phase … Stockman’s apocalypse … InvestmentNews tick, tick, boom … Roubini’s perfect storm … Grantham’s growth gone forever … place your bets at Wall Street’s casinos … the risk’s only 87% … or is it 100%?

Source: MarketWatch

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Wynter Benton Returns, Predicts Silver Will Trade Above $50 by Dec 31, 2012

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Wynter Benton is an ex JPMorgan Commodities broker who was well know for his accurate predictions via Yahoo’s forum in the silver market. After been missing for the last 11 months, has returned to predict silver to go to $50 per oz by the end of the year. A fascinating story of what happened to MF Global.

Silverdocters writes:

Benton claims that the Oct 31st 2011 take-down of MF Global was SPECIFICALLY designed to prevent the group of former JPM traders with a chip on their shoulders against their old boss Blythe Masters from taking delivery of a massive amount of physical silver and breaking JP Morgan’s massive naked short silver position.

Benton also claims that JP Morgan’s $36 silver derivative time-bomb is still in effect, and states that the ex-JPM traders have re-grouped, and that silver WILL trade above $50 before Dec 31, 2012.

Benton wrote on Yahoo’s forum of his latest prediction.

We wish to inform our followers that silver will trade above $50 before Dec 31, 2012.

The $36 silver derivative timebomb is still in effect for the Morgue so count the trading days once silver gets above $36.

MFG was setup to prevent us from taking silver above $45 last year. Did anyone wondered why MFG failed precisely 30 days before our deadline or why no one can locate the vaporized money? It was designed SPECIFICALLY to stop us from taking silver up and out. Think about it.

Too bad The Morgue cant do that again this time cause we are beyond their reach now.

Once again, we are back. . . . . do da do da. . . .

http://finance.yahoo.com/mbview/threadview/?&bn=657e31ff-3231-3847-9760-4f6647a2dfc9&tid=1347560331309-c1ef57d8-049d-48bb-9918-c56a7832d4d9&mid=

Source: silverdoctors

 

Economic 9/11 in 2012

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There have been many predictions of markets and economies crashing this year but in the Daily Mail today is a report from 3 well-known forecasters and authors Gerald Celente, Harry Dent and Robert Prechter that this year you had better prepare for an economic 9/11.

Just when you thought unemployment was dropping and stock markets were surging back, these three analysts today sent out a stark warning to Americans to brace for another financial crash.

Trend forecaster Gerald Celente advises buying a gun to protect your family, stocking up on gold if the dollar crashes and planning a getaway, so it’s no shock he’s preparing for an ‘economic 9/11’.

Share prices and unemployment are posting their best figures in four years since the recession hit, but Mr Celente, along with authors Harry Dent and Robert Prechter, says the rebound won’t last.

All three were profiled in a USA Today feature on Monday. Mr Dent, who had The Great Crash Ahead published last September, believes stocks are simply experiencing an artificial short-term boost.

Mr Prechter, who had a new version of Conquer the Crash published in 2009, is fearful of today’s economic similarities to the Great Depression and says the brief recovery will fail like in the 1930s.

‘The economic recovery has been weak, so the next downturn should generate bad news in a big way,’ he told USA Today, saying the markets look ‘very bearish’ for the third time in 12 years.

Mr Celente, who works as an analyst at the Trends Research Institute, which he founded in Kingston, New York, has been doom-mongering for years – so his latest concerns are hardly surprising.

But he told USA Today that a potential run on banks by savers could cause the government to invoke a national holiday and temporarily close them all, which happened during the Great Depression.

‘When money stops flowing to the man on the street, blood starts flowing in the street’

Gerald Celente, trend forecaster

It comes as billionaire Berkshire Hathaway chairman and CEO Warren Buffett today painted a happier picture of stocks, which he said are relatively cheap compared to other investments as the economy improves.

Meanwhile contracts to buy previously owned U.S. homes neared a two-year high in January in further evidence the housing market was slowly turning the corner, an industry group said today.

However oil prices have been spurred higher by worries over disruptions to Middle East supplies due to sanctions against Iran and expectations for greater demand from an improving U.S. economy.

On the stock market
But on the markets, the S&P 500 has risen nearly nine per cent so far this year and the Dow Jones is trading around the psychologically-important mark of 13,000. But the three experts aren’t happy.

Mr Prechter told USA Today both markets will crash back below their lows hit at the height of the financial crisis in March 2009. Unemployment fell last month to 8.3 per cent, a three-year low, and weekly jobless claims are at a four-year-low.

But Mr Dent believes that people will be left out of work again in 2013 or 2014 and U.S. markets will crash because central banks have been pumping so much money into markets that they are unrealistically strong.

Elliot Wave Prediction For Gold

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Elliot wave prediction for Gold from Jesse’s Cafe Americain.

Saxo Bank 10 Outrageous Predictions For 2012

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Published on ZeroHedge. The theme for this year is the perfect storm.

OUTRAGEOUS PREDICTIONS 2012

1 – THE STOCK OF APPLE INC PLUMMETS 50 PERCENT FROM 2011 HIGH

No sovereign or corporate empire has ever maintained its superior position for long because attacks mount and loyalty fades. Going into 2012 Apple will find itself faced with multiple competitors such as Google, Amazon, Microsoft/Nokia, and Samsung across its most innovative products, the iPhone and iPad. Apple will be unable to maintain its market share of 55 percent (three times as much as Android) and 66 percent on the iOS and iPad as Android will gain further momentum and Amazon’s low priced Kindle Fire will cut deeply into Apple’s tablet reign. In relation to current earnings Apple is not expensive but expectations about future profit growth will come down hard as competition reaches insane levels and crushes Apple’s profit margins.

2 – EU DECLARES EXTENDED BANK HOLIDAY DURING 2012

The December EU Treaty changes prove insufficient to solve EU funding needs – particularly those in Italy – and the EU debt crisis returns with a vengeance by mid-year. In response, the stock market finally caves in and drops 25 percent in short order, prompting EU politicians to call an extended bank holiday – closing all European exchanges and banks for a week or more. EU leaders gather like Vatican cardinals at a conclave to hammer out a “New Europe”. This could result in EU officials overstepping their mandate once again with new burdensome command and control measures that further violate the principles of the EU and free markets. Regardless, this “final” attempt leads straight to a popular overthrow of the old order and beginning of destruction of the sovereign debt time bomb. A period of pain is inevitable, but this will quickly allow a “new EU” to regroup with new membership and a new base from which its economies and markets can start planning for the future, rather than dealing with the mistakes of the past.

3 – A YET UNANNOUNCED CANDIDATE TAKES THE WHITE HOUSE

In 1992, a savvy, yet highly erratic Texas billionaire named Ross Perot managed to take advantage of a recessionary economy and popular disgust with US politics and reap 18.9 percent of the popular vote. Step forward to 2008, and Obama promises “real change” from eight years of Republican rule as the economy is nose-diving. Now, three years of Obama has brought too little change and only additional widespread disillusionment with the entire US political system. Going into the election in 2012, the incumbent Democrats are in ideological disarray and will get the blame for continued economic malaise and the favour-the-rich Republicans will never win the popular vote with the US rich/poor gap at a record width and social tension rising. In short, conditions for a third party candidate have never been riper. Someone smart enough to sense this and with a strong programme for real change throws his hat in the ring early in 2012 and snatches the presidency in November in one of the most pivotal elections in US history, taking 38 percent of the popular vote. A new political order is born.

4 – AUSTRALIA GOES INTO RECESSION

The Chinese locomotive has been losing steam throughout 2011 as investment and real estate led growth becomes harder and harder to come by due to diminishing marginal returns. The effects of the slowing of the up-and-coming Asian giant ripple through Asia Pacific and push other countries into recession. If there ever was a country dependent on the well-being of China it is Australia with its heavy dependence on mining and natural resources. And as China’s demand for these goods weakens Australia is pushed into a recession, which is then exacerbated as the housing sector finally experiences its long overdue crash – a half decade after the rest of the developed world.

5 – BASEL III AND REGULATION FORCE 50 BANK NATIONALISATIONS IN EUROPE

As 2012 begins, pressure will mount on the European banking system as new capital requirements and regulatory pressure force banks to deleverage in a great hurry. This creates a fire sale on financial assets as there are few takers in the market. Troubled sovereigns, structural funding gaps and massive trading books set the scene for the largest bank rescue operation in Europe’s history. Politicians, eager to score points with the public, create a regulatory mob enforcing value destruction in the banking system “in the name of greater good”. A total freeze of the European interbank market forces nervous savers to make bank-runs, as depositors distrust deposit guarantees from insolvent sovereigns. More than 50 banks end up on government balance sheets and several known commercial bank brands cease to exist.

6 – SWEDEN AND NORWAY REPLACE SWITZERLAND AS SAFE HAVENS

Sweden and Norway are at risk of replacing Switzerland as the new safe havens – “risk” because, as we saw with Switzerland, becoming a safe haven in a world of devaluing central banks presents a number of risks to a country’s economy. The capital markets of both countries are far smaller than Switzerland, (the combined FX volume in Sweden and Norway being a mere fraction of Switzerland’s), but the Swiss are aggressively devaluing their currency and money managers are looking for new safe havens for capital. At the same time, Germany and its balance sheet are embroiled in the EU debt debacle and the classic safe haven appeal of 10-year Bunds is fading fast. Sweden and Norway sport excellent current account fundamentals, prudent social policies and skilled and flexible labour forces. Flows into the two countries’ government bonds on safe haven appeal becomes popular enough to drive 10-year rates there to more than 100 basis points below the classic safe haven German Bunds.

7 – SWISS NATIONAL BANK WINS AND CATAPULTS EURCHF TO 1.50

Switzerland’s persistency in fighting the appreciation of its currency will continue to pay off in 2012. After the dramatic failure of direct FX intervention in the market in 2009 and 2010 and after EURCHF threatened to destroy the Swiss economy with its death spiral towards parity in mid-2011, the Swiss National Bank and Swiss government finally joined forces to engineer an aggressive expansion of money supply and established a floor in EURCHF at 1.20. With Swiss fundamentals – particularly export related – continuing to suffer mightily in 2012 from past CHF strength, the SNB and government bear down further to prevent more collateral damage and introduce extensions to existing programmes and even negative interest rates to trigger sufficient capital flight from the traditional safe haven of Switzerland to engineer a move in EURCHF as high as 1.50 during the year, much to the chagrin of those who believe central banks can’t intervene successfully.

8 – USDCNY RISES 10 PERCENT TO 7.00

The impressive growth rates in the world’s second-largest economy, China, since the end of the Great Recession have been predicated on investment and exports. As marginal returns from building million-inhabitant ghost towns diminish and exporters struggle with razor-thin margins due to the advancing CNY China gets to the brink of a “recession”, meaning 5-6 per cent GDP growth. Chinese policymakers come to the rescue of exporters by allowing the CNY to decline against a US Dollar – buoyed by its safe-haven status amid slowing global growth and an on-going Eurozone sovereign debt crisis – and send the pair up to 7.00 for a 10 percent increase.

9 – BALTIC DRY INDEX RISES 100 PERCENT

Despite the dry bulk fleet being expected to outgrow demand in 2012, leading to further over capacity, several factors could surprise resulting in a price spike in the Baltic Dry Index. Lower oil prices in 2012 could lead to an increase in the Baltic Dry Index as operating expenses go down. Brazil and Australia are expected to expand iron ore supply, further leading to lower prices and therefore higher import demand from China to satisfy its insatiable industrial production. In combination with monetary easing this leads to a massive spike in iron ore demand. The last shock that could impact the dry bulk market is exceptional dry weather, due to El Nino, leading to a plunge in hydropower electricity generation and thereby fuelling demand for coal imports.

10 – WHEAT PRICES TO DOUBLE IN 2012

The price of CBOT wheat will double during 2012 after having been the worst performing crop in 2011. The drop was brought about due to a combination of farmers responding to high prices in 2010/11 and normalised weather in the Former Soviet Union. However with 7 billion people on the earth and money printing machines at full throttle bad weather across the world will unfortunately return and make it a tricky year for agricultural products. Wheat especially will rally strongly as speculative investors, who had built up one of the biggest short positions on record, will help drive the price back towards the record high last seen in 2008.

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