After World War II, the US was the largest creditor nation and the lender of choice for most foreign countries. However, after 1971, when the US was taken off of the gold standard, the US slowly started to become a debtor nation and today sits as the largest debtor nation in the world.
The US Government is bankrupt. The only reason we don’t default on our debt is because we are able to continue to borrow and create new debt to pay for the old debt. This is like opening a new credit card account in order to be able to make the payments for your old, maxed out credit card.
Of course this is a no win situation and one day our creditors will draw the line and stop the madness, which means they will stop buying US Treasuries. When that happens, there will be a huge sucking sound as the US and global economies go down the drain in the blink of an eye.
The chart below is all you need, to see how much trouble the US economy is in. When the system breaks, it’s going to be monumental and that day is approaching soon.
I see a lot of negative remarks in the forums regarding Bo Polny, however, as a technical trader I can tell you that Bo is a good technical analyst.
I’m not a religious person and I would never base my investment decisions on biblical prophecy and I think Bo’s negative feedback stems from his religious slant regarding his analysis.
As a result, investors tend to react negatively, if not vehemently, against analysis that is based on something other than statistical, technical or fundamental analysis.
That being said, if you take the religious aspect away and just listen to his technical analysis, it makes a tremendous amount of sense and tends to be right on the money most of the time. Like he said, being correct 80% of the time is an incredibly good score.
I’ve been following Bo’s predictions for over two years and in 2014 and part of 2015, his timing for a market crash was completely off and people crucified him for it. But this time, I think he might be on to something, just by looking at the technical indicators and if he’s right about the crash timeline, there is very little time to prepare.
The chart below is what struck me during his interview. During the stock market crash of 2000 - 2002, it took 31 months to go from the market high down to the market low. Then during the crash of 2007 – 2008, it only took 17 months from high to low, almost half as long.
Bo thinks this next crash cycle will be even shorter than the previous, which means that the low could be reached prior to August 2016. That’s only three months away.
Far-fetched? Maybe! All we can do is wait and see, but what if it’s true and we have some black swan that causes a massive sell-off in the next 3 months? There are plenty of economic time bombs just waiting to go off globally. Are you prepared for a major stock market crash within the next 3-4 months?
We know that the market has already rolled over from its May 2015 high and is printing lower highs and lower lows. We are currently on the next leg in the down cycle and the stochastic oscillator shows the market is due for much more downside.
Whether you are a trader, a long term investor or just managing your IRA, if you prepare for the crash and he’s wrong, then you have lost nothing. Isn’t it better to be prepared for the worst and hope for the best? That’s just common sense to me.
I think Bo’s technical analysis is pretty good when you take away the religious aspect and traders who are new to technical analysis might learn from his expertise.
We all tend to be wrong at some point as technical analysis is not a perfect science, but it does provide greatly enhanced probabilities of future outcomes.
I would encourage you to listen to the interview and make your own decision as to whether his predictions might at least sound plausible to you, because if they do come true, many people are going to be blindsided.
Precious metals just had the best quarter since 1986. But this bull is just beginning and there is a whole lot more upside to come. Gold broke through the downtrend line yesterday and should be headed to a new high. The stochastic oscillator also supports a move higher, so the next couple of weeks should be bullish for gold and silver.
The stock market is rolling over again from the latest short squeeze. No place to go but down. I’m short IYF.
Energy Stocks: (XLE) (UNG) (USO) (LNG)
I suspect the recent short term rally in crude oil to be a dead cat bounce. There should be continued downside from here before we see oil leveling off.
Commodities: (FCX) (JJG) (DBA)
Commodities are in a steep decline and have a ways to go before reaching any kind of support. We may see a double bottom here over the next couple of weeks.
US Treasury Bonds: (TLT)
Treasuries are getting close to a short term top and may level out before making another run up as the stock market falls. Investors go to treasuries when stocks fall, so I expect a consolidation phase before heading higher.
(SLW) January 2017 CALLS
(GDX) January 2017 CALLS
(ABX) January 2017 CALLS
(FNV) January 2017 CALLS
(RGLD) January 2017 CALLS
(SPY) December 2016 PUTS
(IYF) August 2016 PUTS
Crash of Biblical Proportions Coming in 2016-Bo Polny
Gold: Something Is Melting Down In The Global Financial System
The only conclusion we can draw from this is that something has blown up in the global financial system which caused unpredictable instability in – and loss of control over – the Fed’s manipulation mechanisms.