Most of the articles on ZeroHedge do not sugar coat the facts like the rest of the Main Street media does. Most of the readers, not all, stack gold and silver. The Ponzi scheme can only last so long. IMO, the truth is sometimes a bitter pill to swallow.
While the US may be rejoicing its daily stock market all time highs day after day, it may come as a surprise to many that global equity capitalization has hardly performed as impressively compared to its previous records set in mid-2007. In fact, between the last bubble peak, and mid-2013, there has been a $3.86 trillion decline in the value of equities to $53.8 trillion over this six year time period, according to data compiled by Bloomberg. Alas, in a world in which there is no longer even hope for growth without massive debt expansion, there is a cost to keeping global equities stable (and US stocks at record highs): that cost is $30 trillion, or nearly double the GDP of the United States, which is by how much global debt has risen over the same period. Specifically, total global debt has exploded by 40% in just 6 short years from 2007 to 2013, from "only" $70 trillion to over $100 trillion as of mid-2013, according to the BIS' just-released quarterly review.
It should come as no surprise to anyone by now, but the only reason why global stocks haven't plummeted since the Lehman collapse is simple: governments have become the final backstop for onboarding risk, with a Central Bank stamp of approval - in other words, the very framework of the fiat system is at stake should global equity levels collapse. The BIS admits as much: “Given the significant expansion in government spending in recent years, governments (including central, state and local governments) have been the largest debt issuers,” according to Branimir Gruic, an analyst, and Andreas Schrimpf, an economist at the BIS.
Classic example of buy low sell high. Will be interesting to see how GDX, GDXJ, NUGT follow the VGPMX going up.
I'm 52. Thinking about buying some land outside of California. Grow my own crops and have a few chickens, maybe a cow and a goat. Would be nice to make my own cheese.
Not really, good thing all my 401k is in cash. Just exactly are you talking about? My post refers to all the headlines from ZeroHedge. Still think market will implode. DJIA 6000 by 2016. What to do for the next couple of years? My 401k will stay in cash, add to the dips in the GDX, GDXJ, VGPMX. Will be a buyer of SLV below $20.00. Will start stacking gold below $1200.00
I agree. The jobs report was not good. Retail sales poor. Costco wholesale missed earnings yesterday. To many temp jobs, hourly wage went up offset by fewer hours worked. Ukraine still up on the air, not even close to being resolved yet.
Friday March 07, 2014 08:08
The U.S. dollar continues under pressure as capital flows continue to move into the Euro after Draghi held course with rates yesterday. The unemployment report at 8:30 a.m. EST should create the mojo to either break the $1,355 level, or ignite some profit taking. A jobs report under 130,000 will encourage the bulls to test the resistance level, which may lead to stop loss triggers. A better than expected number, north of the 180,000 range, may take some recent enthusiasm out of the bulls’ camp. This is a capital flows story and the big money, which is generally early, is beginning to believe that the European recovery has begun in earnest, and valuations there on a risk/reward are better bets than the U.S. market.
By Peter Hug
Global Trading Director
Kitco Metals Inc.