What depression investing decisions should you be making - important to your and the world's survival?
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Why YOU should be concerned about depression investing? Well, the Greater Depression actually started with the popping of the crazy credit inflation mania bubble in the 2000 dot com stock crash. History will call this the Greater Depression because it will be worldwide and it figures to be three times bigger and three times longer lasting than the 1930's depression. This is mainly because there has been three times more government socialism meddling with the economy.
The start of real estate deflation hit the U.S in 2006. Already prices are down 30% to 70% in some areas. Crashing stock and bond markets will be the next shoe to drop. Trillions of dollars vanish in depression crashes. What about your retirement plan? Isn't it invested in stocks, real estate mortgages, mutual funds (which are just managed bunches of stocks) and bonds? All PAPER! When more corporations start loosing money and when bonds and more mortgages are not getting their interest payments, then the deflation is in its final stages.
Paper wealth is everywhere. There are stock certificates, paper money, paper IOU's in the form of bonds, paper notes and paper deeds of trust on real estate. There are more mountains of paper loans on everything from credit cards to car loans to the paper debt with just your signature. No collateral was needed at all if you had a high enough credit score, good job and good payback history. In a deflation, creditors trust in the solvency of those assets wanes then turns to fear. 100% losses are common if no one is making payments. Our paper money is by fiat. That is French for, "let it be made." It's all a big ponzi pyramid scheme. BEWARE OF FIAT MONEY!
Remarkably, PAPER CASH IS KING in a deflation and hyperdeflation. There's less of it. Its value increases as everything else looses value and the years of built-up credit inflation just crashes of it’s own weight. With depression investing you can plan on asset prices dropping drastically. You can buy bigger better home free and clear at ten cents on the dollar - if you just wait and hold on to cash until the bottom in 2016 - 2018. Expect a 90% drop in most assets. Gold may even drop 50% and unemployment may soar over 35%.
Depression Investing Definition: A recession is when your neighbor is out of work. A depression is when you are the one out of work. A recovery is when President Barack Hussein Obama is out of office.
What the world needs is gold-backed private money or we are doomed to repeat this whole inflation inflicted infection mess again. Only gold is not someone else's debt. Only gold should back only private money. Paper money has to be fully redeemable in gold. Honest money it was called in the old days. Only gold can keep government honest. Do not let the government control the money. They will only inflate it to the moon again (financial repression) to fund socialistic government growth and their pet projects. ONLY TRUST GOLD! Gold price may drop but gold stocks may soar. Gold mines will be mining money. Gold mine shares soared in the 1930's. Not Gold.
The next time the stock market crashes - Soon. The question -"What is Deflation?" - will be answered by a stock market crash three times bigger than the 1930's and lasting into 2016 to 2018. The Dow will be below 1,000 at that time. Prices will not come back for years and years. The buy and hold investment strategy (because in the long run you will come out ok) does not work when the big developing, deep, dark, dangerous, deflation economy and GREATER DEPRESSION comes a-knocking.
The whole world is experiencing the ending of an eighty year-long Kondratiev long wave business cycle that went way overboard due to wholesale government fiat paper money creation.
The world will experience the pain of the cure for credit inflation, a credit deflation. Again, real estate and most other asset prices will drop 90% from peak and bottom in years 2016 to 2018. Even gold may drop in half by then. Unemployment will be 35%.
High unemployment is setting up a snowball effect - a vicious circle cycle of layoffs upon more layoffs. People don't buy as much. Then businesses have to fire workers. Those workers plus the others already without jobs can't buy stuff. In subsequent years employers have to layoff more. This goes on until the excesses of the credit inflation period are liquidated. This is the Multiplier Effect in economics in reverse. Look it up. It feeds on itself! Plus, it goes a lot faster on the way down than on the way up. That is deflation and hyperdeflaton. At this stage of the long wave, the government cannot stop the deflation economy.
Reduced property taxes, reduced income tax and reduced capital gains tax revenues will hurt city, county and state government most since they cannot print money. This will lead to long lines, long waits and a reduced level of service. The economic reality of deflation and the Greater Depression will cause governments at all levels to tighten their belts, including the Feds.
The only cure for inflation is a deflation and hyperdeflation. Credit inflations like we have had always end in a crash per the Austrian school of economics.
Barack Hussein Obama, a community organizer from the politically corrupt city of Chicago. He is a for sure a socialist and may well be a communist/Marxist turning fascist on us. Bad news!
Obama, Franklin Delano Roosevelt, Alan Greenspan and John Maynard Keynes along with many other social scientists and political bureaucrats are the ones whose names will be mud in the future.
This is not what our freedom favoring founding fathers had in mind when they wrote the constitution. In fact, these big brother, Orwellian, wealth redistribution, utopia, power elitist, oppressive, power hungry, police state, tax us into oblivion, take our freedoms, take our rights, take our guns, big government, socialistic, Council On Foreign Relations, warmonger, communistic, Marxist, fascist new-world-order, Trilateral Commission, one-world-government ideas are TYRANNY. We need to stand up for our rights and LIBERTY everywhere we can or we can kiss our own FREEDOM good-bye. We will soon be told what to do, how to act, how high to jump, where to live and what to think. Is this the life you want for your children and your children's children? I don't think so. Stupid is as government does.
Stand up and be a free thinker. Be a contrarian. Be a renegade. Live your life to the fullest. These are historic times. Don't back down! Help restore our constitutions principles.
The dollar has dropped to 4 cents in value from 1913 when the Federal Reserve Bank was secretly hatched by the power elite banksters. We have had our runaway inflation. First we got disinflation (1990's & 2000's), then deflation (now) and finally hyperdeflation possibly until 2020. Depression investing is betting on prices dropping - going short and buying back in near the lows in 2016 to 2020. CASH IS KING when it comes to depression investing. Safety is tantamount. Hurry and get prepared by doing your depression investing before it is too late!
Copyright by Delwyn Lounsbury - THE DEFLATION GURU
Use of this article allowed with attribution back to:
http://www.deflationeconomy.com
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The GREATER DEFLATION is approaching quickly!
We need to get the word out or else we will all be seeing each other down at the soup line.