Tuesday, November 1, 2016

Monthly Crisis Watch

This month I will just provide a link to this recent interview with Jim Rickards. In it, he talks about his new book which directly predicts the kind of crisis we watch for here. He suggests that it will happen by 2018, but says the conditions exist for it to happen at any time before then as well. Below is the summary of the interview done by Oxford Club radio.


"This week on Oxford Club Radio, Marc interviews gold expert Jim Rickards. He’s the editor of the Strategic Intelligence newsletter and author of a new book that has already topped several Amazon charts. It’s called The Road to Ruin: The Global Elite’s Secret Plan for the Next Financial Crisis.

As Rickards explains, the '90s were a period of risk and instability for hedge funds. Eventually, Wall Street had to bail out hedge fund managers. Then, in 2008, central banks had to bail out Wall Street.
In both instances, global financial markets nearly ground to a halt. They were rescued at the last minute by government and banking interventions. And the underlying problems that cause these crises were never solved.
Rickards points out that it has been about eight years since the last financial crisis. These events tend to reoccur in eight- to 10-year intervals. Until now, the government has intervened during crashes by printing money. This provides liquidity and prevents bank runs.
However, after the 2008 crisis, the Federal Reserve’s balance sheet ballooned from $800 billion to more than $4 trillion. And they’ve made very little effort to bring it back down to a normal level.
Rickards believes that this policy of printing more money is ultimately not sustainable. If the Federal Reserve allows its balance sheet to pass $8 trillion or $12 trillion, people may start to lose faith in our currency system.
Check out the clip above to see why Rickards says, “We’re only one phone call away from martial law.”
My added comments: Obviously everyone would like to know the timing for the kind of crisis Jim predicts if we are to get one. Jim consistently says he cannot know the timing and almost always projects it out into the future at some unknown point in time. 

Here he actually mentions 2018, but I don't think this means he believes he knows the date. I think he is just suggesting that the odds are it will happen by then. He does point out that the systemic risk conditions are such that it could happen at any time. Here is another similar interview that also includes some comments on the upcoming US election (pre bombshell from the FBI). 

Jim sent me a note to say that he has done some later interviews with more up to date comments such as these two:

Dan Popescu Interview

Interview with Rogue Money

Interview with Greg Hunter

Interview with Ron Paul

Jim will post all new interviews to his twitter feed here

Added notes: In October we also got comments by highly respected expert Otmar Issing suggesting he does not see a bright future for the EU as we reported in this article here. After his comments appeared, Robert Pringle told me he takes these comments very seriously.

It should also be noted that a number predicted dates for a major crisis once again passed by this year and were proven to be incorrect. By now, it should be apparent that all these specific date forecasts are virtually useless. 

Here, we think the wiser course is to stay alert and keep informed understanding that the conditions for crisis do exist, but they have existed for some time without such a crisis. This can continue well into the future or a crisis could arise at any time. That is just the reality of the situation and why holding long term insurance is also a wise choice.

Late breaking events: It's reasonable to wonder if the events going on in the US Presidential election will impact the financial system/markets etc. I will just admit that I have no idea. It could range anywhere from virtually no impact to a substantial impact on the markets. I think most markets had priced in a Clinton win, so a surprise Trump win would be more likely to create an impact. Of course, if the current investigation of Hillary Clinton were to lead to some kind of indictment (especially if she were elected President), we can assume there would likely be a substantial impact on markets. 

Added note 11-3-16: Fox News issued a report indicating that sources close to the FBI have said an indictment related to the Clinton Foundation is "likely" and that the private email server owned by Hillary Clinton was hacked by at least 5 foreign governments. If these reports turn out to be true, we will need to monitory the political situation more closely in terms of it potentially impacting markets. If the FBI is planning an actual indictment and that does not happen until after the election, things are going to get messy in the US. The uncertainty around such a situation (especially if Hillary Clinton is the President) will very likely create havoc in both US and global markets.


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  2. https://www.youtube.com/watch?v=2rhm0Zm-J4k