This Time It’s Different

I vaguely remember the 1970s. There was an entire cottage industry of people writing books, newsletters and giving seminars on the coming economic crisis and the end of the world as we know it. I believe that is also when the survivalist movement gained prominence.

Back then it was the lunatic fringe, the crazies and the conspiracy theorists predicting a coming worldwide economic collapse and or hyperinflation. This time it’s different. Reputable investors, investment advisors and former government officials in the know are the ones predicting an economic collapse.

They are making these predictions based on Austrian economic theory and common sense. You cannot create wealth by printing money; most of the central banks of all the major countries are printing money by the trillions. You do not have to be a “rocket scientist” to understand this will end very badly.

The Austrian school of economics, in simple terms, teaches that wealth is created by savings, investment and production; and that recessions or economic contractions are a necessary deleveraging needed to correct for excesses in the economy.

The following is a partial list of authors, economists and commentators who understand the real crisis facing the world as a result of false Keynesian economic theory.

Peter Schiff, investment advisor and money manager. His books: The Real Crash and Crash Proof 2.0.

Michael Pento, investment advisor, money manager and economist. His book: The Coming Bond Market Collapse.

Jim Rickards, attorney, financial consultant. His books: The Death of Money and Currency Wars.

Doug Casey, investment advisor. His book: Crisis Investing: Opportunities and Profits in the Coming Great Depression.

Mark Faber, investor, money manager, investment advisor. Web site, gloomboomdoom.com.

Gerald Celente, trends forecaster. Publisher of The Trends Journal.

David Stockman, former congressman and Director of the Office of Management and Budget for President Reagan. His book:The Great Deformation.

Dr. Paul Craig Roberts, economist, Assistant Secretary of the Treasury under Reagan, editor and columnist. His book: How America Was Lost.

The general point that all these above gentlemen make is that an economic crisis is coming, it is baked into the cake so to speak. To paraphrase Doug Casey, just because something is inevitable, does not mean that it is imminent. Nobody knows, for sure when things fall apart, or how bad it will get. None of the excesses and causes of the 2007-2008 mortgage crisis have been dealt with or corrected. They have just been swept under the rug, “too big to fail” and all that. So when the inevitable correction comes clearly it will be worse than 2007-2008.

One of the interesting things about the stock market and the economy in general, is that if you know what is coming you can prepare and profit from the coming crisis, or at the least protect yourself from loss. No matter what happens, there is always money to be made somewhere.

For the average person, unsophisticated in the markets and the economy, the best thing to do to protect oneself is to own physical gold and silver outside the banking system. For the more sophisticated, the second thing to do is to own stocks in the commodities area, such as gold and silver mining stocks, energy stocks, etc., raise cash and buy quality, dividend paying companies, after the collapse, at bargain basement prices.

[NM1]