Question from reader:
I am not sure if you got the report out but I could not find it. Is it possible the Winter has not started? I have read that we are about to have the 1929 crash then the winter. What are your thoughts? If we are in the winter is it normal to see a dow jones/Gold ratio go from 6 to 13.5? Thanks just trying to figure this out.
Ian’s response:
I haven’t published it yet. I have not been well and to be honest my writing stinks. I know what it is I want to write, but somehow I can’t get it written effectively.
Let me tell you what it is I have been trying to convey to my readers in this 2nd cycle instalment. In it I cover currency cycles, the long wave economic cycle and the outlook for US stocks and gold.
Currency cycles. All cycles are converging in 2014 which strongly suggests a collapse in major currencies next year. The implications of this are truly frightening, since fiat currencies are debt based currencies. If the currencies cease to function economies cannot operate- no deliveries to grocery stores and gas stations, aeroplanes won’t be flying-everything will grind to a halt. It is difficult to see how investment markets can function in such an environment, because paper money is essentially worthless. I think that the Eastern countries led by China are preparing for such a scenario. They are accumulating physical gold as fast as they can and establishing exchanges to trade the physical metal.
The US is trying desperately to preserve the Dollar as the world’s reserve currency and typically that desperation is manifest in its war on gold. It has always been this way, once the authorities start to lose their control of fiat money they do all they can to stop their citizens from turning to gold and silver as means of payment. That battle has never been won and the US is going to lose this one, probably in 2014; it’s going to be frightening. China will step into the breach with a gold backed Yuan.
You are correct, The long wave winter should have started following the stock market price peak in early 2000, as it did following the stock market price peaks in 1837, 1873 and 1929. That it didn’t was entirely attributable to the ability of central banks to create paper money at will. That, too will end in 2014 and the subsequent economic depression, which has been forestalled for 14 years, will be far more crippling than any of the previous long wave depressions.
Stock prices will reflect this horrendous scenario. The demand for Gold on the other hand will rise exponentially and I believe that within a year it will not be obtainable at any price.
That’s a synopsis of what i have been writing. Now I bet you want the complete version. It won’t be long in coming.