Mike Larson and I feel it’s time to give you an advance warning of a market crash on the near horizon.
Here’s a quick rundown of our outlook right now for bonds, precious metals and stocks …
Long-term bonds first began plunging this year in Japan. Then, the crash spread to the U.S. and abroad.
And just this past week, it began to accelerate in a big way. In fact, the price of U.S. Treasuries have sunk so rapidly that 5-year notes suffered their worst one-day percentage drop in recorded history, as their yields surged.
Meanwhile, bonds of emerging market countries have plunged across the board. And even the bond market of cash-rich China saw chaos this week.
And today, bonds of every shape and color — including municipal bonds, mortgage bonds, corporate bonds and U.S. government agency bonds — are taking still another beating.
But Mike, who has repeatedly shouted from the rooftops about precisely this scenario, tells us that what we’ve seen so far could be just the opening act in a global drama of historic dimensions.
Reason: Central banks may be forced to wind down what has been the most reckless money-printing-bond-buying scheme of all time.
Moreover, even if central banks continue printing money like crazy, the law of diminishing returns has already begun to strike, says Mike: The more bonds that central banks buy up, the less they get for their money in terms of lowering bond yields.
Gold has just plunged by the most in two years. Silver, palladium, platinum and most commodities have also been smacked down.
But these are all moves that Larry Edelson has warned us about — unambiguously and courageously — since before they peaked many months ago.
And as he said in our interview published this past Saturday, we’re now very close to a major bottom in gold, probably in the $1,100-$1,200 per-ounce area, setting the stage for the next phase in gold’s bull market to $5,000 and beyond.
The sequence of events we’re witnessing today is uncannily similar to that of 1987: Japanese bonds crashed in April of that year. Then the crash spread to U.S. mortgage bonds, and next to U.S. Treasuries and bonds globally.
Five months later, U.S. bank stocks fell off a cliff. And in the following month, the Dow suffered its worst one-day crash in history.
Will this pattern repeat itself in 2013-2014? If so, how long will the time lag be this time? Will the stock market decline be just a sharp correction followed by a new upswing as in 1987? Or will it mark the beginning of a new long-term bear market?
Mike will be addressing these questions in his Safe Money Report. But the fact remains no one can know the answers with certainty.
|When gold, stocks and bonds hit bottom, a fat hoard of cash will be your best ammunition for scooping up the best bargains.|
In any case, if you have profits in your stock portfolio, his view is that you can’t go wrong by taking some of them off the table right now.
And when each of these markets hits bottom — first gold, then stocks and ultimately bonds — a nice, fat hoard of cash will be your best ammunition for scooping up some of the best bargains of our time.
We’re watching all three like a hawk. As we see major moves and turning points, we’ll do our best to alert you.
Whatever you do, or wherever you may be, this is one time you must not take your eye off the ball: Over the next few weeks and months, be sure to stay glued to your email and catch every issue of Money and Markets for timing updates.
Good luck and God bless!