Note: For my new subscribers, an ALERT is a collection of facts and/or events that causes me to personally take action. Historically, I issue them quite rarely. My bar is high.
If I were to rank my ALERTS on a scale, rather than as a yes/no binary condition, today’s would be either #1 or #2 on that all-time list.
Because I know these propel many of you to your own actions, I feel the responsibility of my position and sincerely hope I am providing good guidance. At the end of the day, either what I am concerned about will come to pass or it won’t. But that’s not how I score my alerts.
For example, in October of 2008, I alerted people to “get cash out of the bank now!” just a week before all hell broke loose. I took cash out and said others should as well. Years later, we learned that the deepest of Wall Street insiders and bank CEO’s were doing exactly that for themselves, but not telling anyone. The fact that the banking system didn’t completely collapse doesn’t diminish the importance of my advice or in any way invalidate the actions of the people who followed that advice.
What we’re doing here is engaging in risk management. Risks have probabilities. Sometimes you take steps and place bets and – thankfully – those insurance policies aren’t actually drawn upon. I am not a fortune teller, I am a risk manager. I play the probabilities and then communicate those to you.
In all my years of watching the financial markets on a daily and often hourly basis, I’ve never seen such terrible risks to our financial system.
This is 2008, but an order of magnitude worse.
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Brent Johnson’s Dollar Milkshake Model pretty much exactly predicted what’s happening right now in currency markets
Here’s an excellent interview in which he lays it all out. It’s scary how much of his predictions from last year are coming true in 2022
Just got this similar email:
AVOW GRI Members…
"If I were to rank my ECONOMIC ALERTS on a scale, rather than as a yes/no binary condition, today’s would be either #1 or #2 on that all-time list. Because I know these alerts propel many of you to your own actions, I feel the responsibility of my position and sincerely hope I am providing good guidance. At the end of the day, either what I am concerned about will come to pass or it won’t. But that’s not how I score my alerts.
For example…
It wouldn’t hurt to have some, though how much is up to you. I’ve very little money so not in much of a position to speak to this, but I have some cash (Canadian) and a bit more saved in gold and silver. I trust it more than Canadian bank notes.
Was just at youtube and Mike Maloney did a video on crisis investing today - complete with charts and all. Might be useful to watch. https://www.youtube.com/watch?v=QyLVBp7kMss
Ok, so is this telling us to start taking cash out? Also what currency would be best to convert money into? From most articles out there, it seems like most currencies are not going to fair well.
This was put out around ten months ago and back then there wasn’t a gold backed currency as the Ruble today. People will flock to the Ruble and drop the USD so his whole thesis needs to compensate for the new realities as the USD is in BIG time trouble now
If you don’t have physical silver yet, this is a good time to get some. It’s heavy and difficult to take with you when you are mobile. Couple of monster boxes of silver American Eagles won’t hurt. LOL. Others at Hardassetsalliance.com.
I would be very interested in what others are investing cash in now… Unfortunately I am heavy in cash and don’t want to put it in the market or bonds and I usually do real estate but prices are so inflated that I haven’t found anything worth buying. I am very concerned about having so much cash reserves right now and I’m wondering if someone can say what they are doing if they’re in a similar situation.
What am I doing with some of my cash? I’m looking into farmland. Specifically Farmland LP, and have invested with Acre Trader. Farmland LP buys farms and transitions them to sustainable organic farming. First though I purchased a large solar system for my home, generating extra capacity for an EV truck, Coming soon as I consider trucks a tool that we find very useful. Will buy more PMs since the price got smashed.
Thankful to be informed and educated and encouraged from so many on this site.
I have been purchasing silver over the last several years when my budget allows. I purchased more last week with the price drop.
Please tell me how silver and gold can be used in the future if/when there is a currency crisis. Now if I purchase something with my silver dollar coin from a store it is only a dollar worth of goods instead of the market rate of silver.
Will there be buyers of silver and gold in the future?
I’m buying silver now for diversification but I don’t quite know what it means in terms of spending power in a world that is between the old story and the new story that we’re preparing for.
Please help me understand why I’m buying silver.
Thanks!
Pilgrim
Classic answer is to buy US “JUNK” pre 1965 silver coins, thinking people in US will at least recognize them as real, while you are explaining to them how valuable they are compared to the corn they have for sale.
Hey Pilgrim,
Great to read that you are getting ready for tough times by investing in silver. I also started a position in silver ~ 12 years ago, and have been growing it thru the years, as my cash flow permits. Sadly my position is small, but that it’s ok, I am saving mostly to come ahead when the fiat currencies collapse. In a world where all currencies are being hyperinflated, you feel the pain when you go to the store and everything is more expensive than it was last week. When people realize that they are being screwed by the government, they will search for alternatives to the local currency, that is when gold and silver will shine.
I was born and raised in Mexico and saw firsthand the wealth of people being ransacked by the government overnight by currency devaluation. The US dollar went overnight from $3 pesos to $9 pesos per dollar, and there was nothing you could do about it. The middle class was rushing to the currency exchanges, banks, the black market, and everywhere else they could think about to get ahold of those elusive US dollar bills to try to rescue as much of their hard earn wealth. It seemed too late to act, but if the crisis deepened and the dollar went to $12 and then $13 pesos per dollar, you were still ahead because you had a more stable currency vs. your local currency.
The current world events are driving people toward the US dollar again. I witness a similar crisis during a trip to Argentina in 2014: Frustrated people purchasing as much as they could on credit because they knew that everything was going to be more expensive next week… And people searching for dollars, even in the small town of Mendoza in the Argentinian mountains. Check Brent Johnson’s dollar milkshake theory https://youtu.be/pVoVIrM2Kaw
Once the world realizes that the US dollar has been hyperinflated, a similar scenario will play out. This is when precious metals will truly shine. As Mike Maloney calls it, the largest wealth transfer the world has ever seen will happen right in front of our own eyes. https://youtu.be/WN9OTxdFF2k
Until then, I plan to keep building my PM position. The day that the regular Joe on the street asks if you have gold or silver to sell, you know you are on the right side of the wealth transfer, and it’s time to change your silver for a different asset class that is depressed at the time.
