11/22/2010

11/22/10
In January 1987 I put out a memo that went out to 4,000 people that simply said " if the 30 year bond market closes two days in a row below 100.00 the count down and the objective will be 74.00". Bonds were at 101.00. I will never forget the negative phone calls I received. Some saying how stupid I was. How could I make such a statement and be a broker? Even if it happens, how can you sell anything to your customers? In other words, how are you going to make a living? I made up my mind I was going to tell people what the markets were going to do no matter what. I was given this talent by God almighty and it is his purpose that you should know, so here goes. I hate to forecast gloom and doom but this is the way I see it. BIG MONEY is continuing to sell dollars and it is clear that they want the DOLLAR INDEX to go down. This reduces the average persons buying power in the United States. If I am right and the DOLLAR INDEX goes to 40.00, everything you can buy today will cost you at least double in the future. The DOLLAR INDEX is at 78.50 and has been as low as 75.23. It's all time low is 72.00 It could take a year or five years, I don't know but here are some indicators that will take place before all hell breaks loose. Bonds will close below 121.00 and that will produce a count to 105.00. Bonds have been to 125 and are now at 127.50. The DOW will retrace to support which is 7,200 and will eventually go through that to the downside. Metals will triple or more in value. Food will double or triple in cost. Expensive items and service orientated businesses will be worth half or less of what they are today. Inflation will be easily double digit and the CRB INDEX will double after making a new high. Your home will be worth half of what it is today. Simply put, our way of life as it exists today, is going to change. I tell you these things now because some of these indicators are getting close. Go to www.barchart.com and see for yourself. By the way, October 1st 1987, 10 months to the day, I sent out my monthly letter that stated "cover all short positions. Bonds have come down to 76.50 and the risk is too great. At any point from here down the bond market could rally to 87.50"  Black Monday came the next week and the DOW dropped 1,700 points in three and a half days. Huge move back then. Bonds rallied to a high of 87.50 in that same time period. All of this can be verified. You can check most of it out yourself. We are 100% invested in metals (SLV) with some other funds in reserve. We are still long BGZ. Nothings changed with CYTX.