Shelter From The Coming Storm


by Gary Christenson, Deviant Investor:

Bob Dylan “Shelter From The Storm”
“I bargained for salvation and she gave me a lethal dose.”

What Storm? Why do we need shelter?
The stock market hit all-time highs in January, corrected, and might rally to new highs… or maybe not… See below.
Official unemployment is low if you believe the statistics and ignore the millions excluded from the calculations.
Inflation, according to official numbers, is low. New cars may have doubled in price in the last 20 years but hedonic adjustments have “massaged” the official inflation on cars to nearly zero. Again, if you believe the numbers… The Chapwood index is more believable.
People buy food and prescription drugs, pay rent and make house payments. They know prices increase more than shown in the “massaged” inflation statistics.

The coming storm involves a combination of:

The end of the 35 year bond bull market. Rates are going higher. See below.

The end of the stock market rally. This rally has persisted for a long time. Valuations are sky-high, margin debt is extreme, and complacency is overwhelming. See below.

Mind-numbing global debt that can’t and won’t be repaid. Name any central banker or three members of congress who want to reduce the debt and balance the budget. Right! Behind door number one lives the default dragon. The inflation monster is anxious to escape from behind door number two. Both are lethal.

Governments and central banks will delay, extend and pretend until they open one of those two doors. Expect distractions, diversions, war, more QE, benign statistics, media hype and happy talk.

A storm is coming! We need shelter. Silver bullion, not the paper stuff, provides financial shelter, is real and will not evaporate like most digital “assets” during the storm.

Stock market capital can disappear in a correction or crash. John P. Hussman, Ph.D. expects an eventual loss of over 65% in the S&P 500 Index. His analysis is far more real than the happy talk from government statisticians and mainstream media.

Bonds entered a bear market (ten year yield bottomed in mid-2016) and losses could be staggering. How well are Puerto Rico bonds holding their value? Does your bond fund own 100 year bonds issued by Argentina? The U.S. will add over a trillion dollars to its unpayable debt every year going forward. When happens when the music stops?

Wall Street expects financial salvation from central bank printing, borrowing inexpensive currency units, and ever-increasing debt.

“I bargained for salvation and she gave me a lethal dose.”

Has the world received a lethal dose of central bank currency printing? How much government debt is a lethal dose?

Yes, a storm is coming! Do your own due diligence, but consider:

When paper (over-valued stocks, too many printed currency units, and sovereign debt issued by insolvent governments) becomes less trustworthy, shift from paper promises to real assets. Silver, gold, platinum and real estate come to mind.

When the monthly Relative Strength Index (14 period RSI) for the DOW hit a 116 year high in January 2018 it warned the DOW had moved too far and too fast. Tops take time to form, but markets always correct from both lows and highs. Do you feel lucky?

Silver is one of the most under-valued assets still available for purchase. Many tech stocks are among the most over-valued paper assets on the planet. Silver looks good. See below.

Sovereign debt is rising. Global debt exceeds $230 trillion. Official U.S. (on-the-books) national debt is approaching $21 trillion. The debt bubble will not blow up next week, but one day the default dragon or the inflation monster will emerge and the financial storm will intensify. We need shelter from that storm.

Read More @