September 23, 2011
– Comments (3)
I generally agree with Mr. Rogers on most views lately (or he agrees with me!).
I differ on the Dollar bullishness he sees over the short run. Once QE3 of TRILLIONS is announced in October or November, the U.S. Dollar will begin a momentous, once in a lifetime collapse.
YOU DO NOT WANT TO BE INVESTED IN CASH, CDs, BONDs, Annuities, and most anything that is fixed-income (excluding some REITs perhaps), as they have ZERO inflation hedge going into 2012, if my vision of the future proves correct.
Once QE3 is announced, owning the Dollar with almost no interest or coupon is about the DUMBEST thing an investor could imagine holding.
If Treasury investments go from an accepted yield of less than 3% to 20% or 30% in 12-18 months, more life "savings" for hard working, playing by the rules, Americans will disappear quicker than 2008.
At that point, sometime in 2012, real protests against the government will begin, and open rebellion could be discussed by average citizens.
The Federal Reserve and Treasury PONZI scheme is cascading toward its end-game, it appears. I am still shaking my head at how stupid our leaders have been the last 18-24 months. Consumer and government debt is entering the "unbearable" zone, and we are just a year or two behind Greece in our debt trajectory. The typical pundit on tv, economic expert, and typical investor really does NOT understand how bad the macroeconomic math is becoming. Oh well, live and learn, I guess.
Have a good weekend everyone, we may not have many left! (You may not believe it, but I am an "optimist" by trade.)
I put out the basic "changes" needed to right America's sinking future in December 2009... Of course, our omniscient leaders have not seriously considered even one of them... http://caps.fool.com/Blogs/how-to-fix-america/302070
Thanks for the thoughts. I generally agree with all your statements/predictions but one: why on earth would our treasury bonds go to 20-30%? The debt here is bad, but not that bad. there is IMO about a 5% chance of a debt crisis here, because unlike Europe we can actually get things done--if rates went up to even 10%, we would have a huge amount of deficit reduction. And even if you disagree with that, unlike Europe we do not have massive tax avoidance and thus a relatively stable flow of funds coming into the treasury that can pay debt service.
Well if your an optimist, and you are that bearish, we may have a big up move before the next leg down. The average guy is out of stocks and no one left to sell.
That is my guess. For the next 5 days anyway!