Ahead of the collapse of 2008 well known investment manager Bill
Fleckenstein warned that real estate and stocks were headed for a crash.
He positioned himself and his clients to absorb the brunt of the
imminent hit that was coming to financial markets. Unlike the millions
of people who saw some 40% of their wealth vaporized by mid-2012,
Fleckenstein survived and actually profited by betting against the
official propaganda.
In an interview with Eric King of King World
News, Fleckenstein warns that the same machinations and corruption
responsible for the collapse of our economic and financial systems in
2008 remain a serious threat today.
Gold rose the most in two
months as the dollar headed for the biggest drop in almost a year,
reviving the metal’s appeal as an alternative investment after prices
touched a 2014 low. Silver jumped the most in 15 weeks.
The
dollar fell as much as 0.9 percent against a basket of 10 currencies as
uneven U.S. labor-market data fuels speculation on when the Federal
Reserve will raise interest rates.
A gold backed currency? What a
crazy concept. My bet is the market will love it. The banks will hate
it, but overall the Swiss people will benefit. So will the non-Swiss who
are paying attention now. Switzerland yet again shows that it is the
most sane nation-state on Earth. Two weeks ago when news broke about the
first confirmed instance of gold price manipulation (because despite
all the “skeptics” claims to the contrary, namely that every other asset
class may be routinely manipulated but not gold, never gold, it turned
out that – yes – gold too was rigged) we said that this is merely the
first of many comparable (as well as vastly different) instances of gold
manipulation presented to the public. Today, via the FT, we get just a
hint of what is coming down the pipeline with “Trading to influence gold
price fix was ‘routine’.” We approve of the editorial oversight to pick
the word “influence” over “manipulate” – it sound so much more…
clinical.
Platinum dropped to the lowest in more than a week in
London, falling below the price of gold for the first time since April
2013, on concern that slowing economic growth will curb demand.
Platinum
slipped about 17 percent since mid-July, partly after a South African
mine strike that deepened a third straight supply shortage ended. Prices
have also retreated on concern slowing economic growth in Europe will
reduce demand. Gold had erased gains for this year earlier this month as
signs of an improving U.S. economy boosted the case for less U.S.
stimulus, strengthening the dollar and curbing precious metals’ appeal.
Looking back, the most
recent financial crisis that we experienced was back in 2008. Lehman
Brothers collapsed, the stock market crashed and we were plunged into
the worst recession that we have experienced as a nation since the Great
Depression. You can see what happened to the Dow Jones Industrial
Average on the chart that I have posted below… It looks like a growing
number of professional investors are preparing for a stock market crash,
as hedge fund filings for the second quarter show a spike in defensive
positions.
In particular, legendary billionaire George Soros made
a huge bet against the market. He increased his short position on the
Standard & Poor’s 500 by a startling 605%. And you thought
stock-market crashes were a thing of the past.
One ancillary
benefit of this week’s turmoil has been to remind us that a market crash
could occur at any time. We had been lulled into a false sense of
security by the markets’ exceptionally good performance in recent years,
coupled with our too-short memories.
At one point during the air
pocket that hit during Wednesday' session, the Dow Jones Industrial
Average had fallen almost 508 points — which, coincidentally, was the
same decline during the 1987 stock market crash, the worst in U.S.
history.
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