Friday, February 12, 2010

Preparing for a Global Debt Bomb...

When the housing market was at it's peak a few years back...and people were seeing only rainbows for their financial future...I started to preach the opposite. I believed then that it would not last...and that we were in for some substantial economic hard times. In fact...I was advising my clients to start getting their money out of the markets and to start buying food storage and stocking up on supplies. This is one of the reasons I had to leave financial services...because I could no longer make money at a planner who doesn't put their clients into investments...makes no money. Also because I started to feel as if I was trying to peddle cigarettes to I was contributing to something morally wrong.

When I left that firm I was with...the manager called me up to try to get me to stay. I told him in no uncertain terms that I believed that another great depression would be short on the horizon. He tried to convince me that the market trends are up...that there may be bumps...but that it will continue up. He mentioned how strong the auto industry numbers were...and the housing numbers. I told him that I believed the "Indicators" to be full of bologna...and that he would see that I was right...that there would be a day of economic reckoning. He ended the conversation by saying..."Well...I hope you are wrong...because then we'll all be out of a job".

And he is. The firm he was with...a large firm...has closed it's doors. The auto and housing markets fell into the dumps...and my forecast...which I take no pleasure in...continues to come true. While I may have sounded insane at the time to many of my clients...and my manager...I'm sure that many of them wish that they would have taken my advice. Many wouldn't have lost a third or more of their savings.

As bad as things are with the economy...I say they will get worse. I say that now more than ever we should question every purchase we make and ask "Will this have any worth during the depression?". "Can I eat it...can I wear it...will it provide the basics to keep me alive".

I am progressively not a lone voice in the wilderness. While the less than mainstream media has supported my beliefs for some my views are progressively mainstream.

Here is an article from the WALL STREET JOURNAL...that sings my song. This is not some guy plunking out articles in his basement. This is one of the most influential and well known publications in the US with regards to investing. An interesting and sobering read.

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