It is one thing for economists outside the mainstream to see markets in extreme bubbles and on the precipice of another 2008 style crash, but when one of Wall Street's own starts publicly talking about the same thing then you know that the threat is quite legitimate.
And that is what happened on March 31 as new warnings from billionaire investor Jim Rogers, economist Martin Armstrong, motivational speaker and trainer Tony Robbins, and of all places Bank of America have several different experts all pointing towards the probability of a new financial crisis, and where each of them are advocating the best safe haven for your money to be that of gold.
Hartnett also presents "a nice Icarus stat": "should the S&P500 exceed 2540 in conjunction with a 3% yield on the 10-year Treasury bond then US stocks will reach an all-time high versus US bonds, exceeding the prior tech bubble peak reached in March 2000"
Still, all great - if abnormal and fake - bull markets and manias come to an end eventually, and Hartnett warns that what follows the final, Q2 "Icarus" rally will be far less enjoyable, because that's when the infamous "great fall" is set to take place.
“Great Fall” potentially comes in H2 as hubris, synchronized monetary tightening, EPS peak coincide; buy long-dated puts in anticipation; we believe best time to sell would likely be after a pop induced by a US tax reform bill (March Fund Managers Survey showed only 10% of institutions expect US tax reform passed before summer recess).
And yes, the Fed will likely try to step in again with more rate cuts to prevent a crash, although this time it won't work at least according to Hartnett, because after the "Great Fall" comes the Long View, which Bank of America describes simply as: Manias, Panics, Crashes
His conclusion is two fold.
On one hand, "our Longest Pictures argue for a treacherous period of potential manias, panics or crashes as policy makers try to normalize policy."On the other, the response will be the same one we have said since day one will ultimately take place: runaway inflation as central banks literally throw everything at the next mega crash, or as Hartnett calls it, "further outperformance of inflation assets versus deflation assets."
His best trade recommendation?
"Buy gold." - Zerohedge
In his usual plain speaking, honest manner, Jim Rogers warned on Bloomberg TV that
"the Federal Reserve... has no clue what they are doing. They are going to ruin us all." Central banks have driven rates to all time record lows and in the process, debt has "sky-rocketed."
Rogers slams the 'counterfactual' arguments that things would have been a lot worse if the Fed had not done all this, "propping up zombie banks and dead companies is not the way the world is supposed to work. ... It's been nine years and we have nothing to show for it [economically] except staggering amounts of debt."
Rogers is pessimistic about the outlook for America and thinks that Donald Trump will see the US continue on the path to bankruptcy - a path set by Bush and Obama before him.
He concludes the Bloomberg interview ominously by saying that "this is all going to end very, very, very badly."
In recent years, Rogers has consistently said that he wants to own more gold and silver and will continue to accumulate the precious metals on any price dips.
Armstrong is nervous about gold in the short term and thinks it could fall as low as $1,000 per ounce prior to surging to as high as $5,000 per ounce in the coming years.From Tony Robbins:
Tony Robbins, performance coach and self help guru has warned that "The Crash is Coming."
Robbins, who is focusing more on finances and wealth in recent years and in his latest book, 'Money: Master The Game', says plan now for what's to come. Things may be looking rosy on Wall Street as of late, but the crash will come.
"We are in a really artificial situation. There is a new high, on average, every month. Feds around the world have been printing money," said Robbins in a tv interview.
Robbins has long advocated owning gold as part of a diversified portfolio and has cited Kyle Bass, Marc Faber and more recently Ray Dalio as his financial gurus. In his recent book, Robbins cited Dalio and recommended an asset allocation strategy that involves a 7.5% allocation to gold.