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Image | Positioning For The Coming Rout
Positioning For The Coming Rout
 PREVIEW
by Chris Martenson

Positioning For The Coming Rout

Thursday, May 12, 2011

Executive Summary

  • What private and public debt levels are telling us
  • Housing’s prospects for worsening the situation
  • Why endless compound growth is impossible
  • The crushing pain of a deflationary downdraft
  • Predictions and conclusions for the future

Part I – Why Growth Is Dead

If you have not yet read Part I, available free to all readers, please click here to read it first.

Part II – Positioning For The Coming Rout

Looking Deeper 

Okay, that’s the big picture. It is why I am convinced that the next twenty years are going to be completely unlike the last twenty years. For starters, we’re not going to be able to double credit this next decade, and that alone is a big shift with huge implications. But we’re also going to be facing higher energy costs, which will further impair the smooth operation of the economic machine, because energy is an input cost to literally everything else. 

But to have an idea of what is going to happen next (say, over the next year) so that we can make better personal and investment decisions, it’s important to dig a little deeper into the data. Here we want to lift the covers on total credit market debt and housing because these are the key elements of this story.

Total credit market debt is first broken into two main buckets: financial and non-financial sector debt. Financial sector debt belongs to commercial banks, savings institutions, credit unions, life insurance companies, brokers, dealers, and government-sponsored agencies. Non-financial sector debt belongs to households, businesses, and governments.

At this level we already see where some of the trouble lurks.

Positioning For The Coming Rout
 PREVIEW by Chris Martenson

Positioning For The Coming Rout

Thursday, May 12, 2011

Executive Summary

  • What private and public debt levels are telling us
  • Housing’s prospects for worsening the situation
  • Why endless compound growth is impossible
  • The crushing pain of a deflationary downdraft
  • Predictions and conclusions for the future

Part I – Why Growth Is Dead

If you have not yet read Part I, available free to all readers, please click here to read it first.

Part II – Positioning For The Coming Rout

Looking Deeper 

Okay, that’s the big picture. It is why I am convinced that the next twenty years are going to be completely unlike the last twenty years. For starters, we’re not going to be able to double credit this next decade, and that alone is a big shift with huge implications. But we’re also going to be facing higher energy costs, which will further impair the smooth operation of the economic machine, because energy is an input cost to literally everything else. 

But to have an idea of what is going to happen next (say, over the next year) so that we can make better personal and investment decisions, it’s important to dig a little deeper into the data. Here we want to lift the covers on total credit market debt and housing because these are the key elements of this story.

Total credit market debt is first broken into two main buckets: financial and non-financial sector debt. Financial sector debt belongs to commercial banks, savings institutions, credit unions, life insurance companies, brokers, dealers, and government-sponsored agencies. Non-financial sector debt belongs to households, businesses, and governments.

At this level we already see where some of the trouble lurks.

Image | Are You Middle Class?
Are You Middle Class?
by Poet

height=This post appeared earlier today in our Forums. We've elevated it here because we think it a useful exercise for the CM.com community to engage in. How realistic is the dream of financial self-sufficiency for today's society?

Are you middle class? Surprisingly, most people who think they are middle class, are not middle class.

Being middle class is being able to afford what most would expect a middle class family of 4 or 5 can afford:

 

Are You Middle Class?
 by Poet

height=This post appeared earlier today in our Forums. We've elevated it here because we think it a useful exercise for the CM.com community to engage in. How realistic is the dream of financial self-sufficiency for today's society?

Are you middle class? Surprisingly, most people who think they are middle class, are not middle class.

Being middle class is being able to afford what most would expect a middle class family of 4 or 5 can afford:

 

Image | Crash Course Deep Dive on FinancialSense.com
Crash Course Deep Dive on FinancialSense.com
by Adam Taggart

This morning, FinancialSense.com released a featured interview between Chris and Jim Puplava delving into Chris’ new book The Crash Course: The Unsustainable Future of our Economy, Energy and Environment.

If you haven’t read the book yet, or if you have and are hungry for more insights into its conclusions, you’ll appreciate this conscientious and intelligent exploration.

Click the image below to listen to/download the podcast:

height=

Crash Course Deep Dive on FinancialSense.com
 by Adam Taggart

This morning, FinancialSense.com released a featured interview between Chris and Jim Puplava delving into Chris’ new book The Crash Course: The Unsustainable Future of our Economy, Energy and Environment.

If you haven’t read the book yet, or if you have and are hungry for more insights into its conclusions, you’ll appreciate this conscientious and intelligent exploration.

Click the image below to listen to/download the podcast:

height=

Image | Buying a House in Today’s Market
Buying a House in Today’s Market
by Patrick Killelea

Since many of our members are considering relocating, downsizing and/or finding housing better suited to their future priorities (e.g. greater energy efficiency), we invited Patrick Killelea, founder of the housing news and forum site Patrick.net, to offer his advice to house buyers in today’s market. Patrick was one of the most vocal bloggers warning about the collapse of the U.S. national housing bubble years before it inevitably popped in 2007.

(A note to those of our readers who work in residential real estate: the views expressed here are Patrick’s own, which he has consistently maintained for years. While some of them are not popular with the realty industry, the resulting dialogue they have created about the structure of our national real estate model has been a healthy one.)

If you’re in the market for a house, there are a number of important factors to consider which your agent just isn’t going to tell you.

Buying a House in Today’s Market
 by Patrick Killelea

Since many of our members are considering relocating, downsizing and/or finding housing better suited to their future priorities (e.g. greater energy efficiency), we invited Patrick Killelea, founder of the housing news and forum site Patrick.net, to offer his advice to house buyers in today’s market. Patrick was one of the most vocal bloggers warning about the collapse of the U.S. national housing bubble years before it inevitably popped in 2007.

(A note to those of our readers who work in residential real estate: the views expressed here are Patrick’s own, which he has consistently maintained for years. While some of them are not popular with the realty industry, the resulting dialogue they have created about the structure of our national real estate model has been a healthy one.)

If you’re in the market for a house, there are a number of important factors to consider which your agent just isn’t going to tell you.

Image | The Rout Is On
The Rout Is On
 PREVIEW
by Chris Martenson

The rout is on.  More market weakness lies dead ahead – unless the Fed reverses course, and soon.

Eight weeks ago, on March 8, 2011, I wrote that there was a very high chance of a rout in all of the major markets – stocks, bonds, and commodities – due to the sudden disappearance of quantitative easing (QE) money at the end of June.

Since markets are supposed to be forward-looking, if the ‘rout’ thesis is correct, we’d expect the markets to begin selling off well before the last POMO. Perhaps even right about, oh, say this past week.

But first, let’s review what I said in The Coming Rout:

The Rout Is On
 PREVIEW by Chris Martenson

The rout is on.  More market weakness lies dead ahead – unless the Fed reverses course, and soon.

Eight weeks ago, on March 8, 2011, I wrote that there was a very high chance of a rout in all of the major markets – stocks, bonds, and commodities – due to the sudden disappearance of quantitative easing (QE) money at the end of June.

Since markets are supposed to be forward-looking, if the ‘rout’ thesis is correct, we’d expect the markets to begin selling off well before the last POMO. Perhaps even right about, oh, say this past week.

But first, let’s review what I said in The Coming Rout:

Image | Addison Wiggin: We Can’t Afford the Solutions Needed to Reverse Our Decline
Addison Wiggin: We Can’t Afford the Solutions Needed to Reverse Our Decline
by Chris Martenson

"Everything is out of whack. We can’t be the policeman to the world and provide a safety net for all citizens if we don’t have the tax rates or the income to the government that supports all that. It seems like common sense, and it should be common sense. But something happens when you take it from a discussion that you and I might have to the political level, which is often just driven by emotion and public speech. Somehow the desire, the continued promising that the government can solve all problems, meets with jubilation and boasts. And people want to just keep going, and they never want to actually accept that at some point the unsustainable has to end. I mean, that’s the nature of the world.

It gets frustrating to think that we’re at a point where politicians are really going to have to work together to come up with solutions that are going to be unpopular to anyone – and I struggle to think that we’re even capable of putting together a set of solutions that will work. It might be too late."

So states Addison Wiggin, executive publisher of Agora Financial and executive producer of I.O.U.S.A. Strong words from a man who has been writing for over ten years about how our debt-inebriated economy will eventually collapse upon itself – but is still shocked and saddened to see his predictions play out in reality. He sees the global economy to be at a point of massive destructive transformation – but full of opportunity for informed investors, and, ulitmately, for the system that succeeds it.

Click the play button below to listen to Chris' interview with Addison Wiggin (runtime 41m:50s):

[swf file="http://media.PeakProsperity.com/audio/addison-wiggin-2011-04-29.mp3"]

Download/Play the Podcast
Read the Transcript of the Podcast
Report a Problem Playing the Podcast

In this podcast, Addison expounds on:

Addison Wiggin: We Can’t Afford the Solutions Needed to Reverse Our Decline
 by Chris Martenson

"Everything is out of whack. We can’t be the policeman to the world and provide a safety net for all citizens if we don’t have the tax rates or the income to the government that supports all that. It seems like common sense, and it should be common sense. But something happens when you take it from a discussion that you and I might have to the political level, which is often just driven by emotion and public speech. Somehow the desire, the continued promising that the government can solve all problems, meets with jubilation and boasts. And people want to just keep going, and they never want to actually accept that at some point the unsustainable has to end. I mean, that’s the nature of the world.

It gets frustrating to think that we’re at a point where politicians are really going to have to work together to come up with solutions that are going to be unpopular to anyone – and I struggle to think that we’re even capable of putting together a set of solutions that will work. It might be too late."

So states Addison Wiggin, executive publisher of Agora Financial and executive producer of I.O.U.S.A. Strong words from a man who has been writing for over ten years about how our debt-inebriated economy will eventually collapse upon itself – but is still shocked and saddened to see his predictions play out in reality. He sees the global economy to be at a point of massive destructive transformation – but full of opportunity for informed investors, and, ulitmately, for the system that succeeds it.

Click the play button below to listen to Chris' interview with Addison Wiggin (runtime 41m:50s):

[swf file="http://media.PeakProsperity.com/audio/addison-wiggin-2011-04-29.mp3"]

Download/Play the Podcast
Read the Transcript of the Podcast
Report a Problem Playing the Podcast

In this podcast, Addison expounds on:

Image | What The Recent Volatility In Gold and Silver Means
What The Recent Volatility In Gold and Silver Means
 PREVIEW
by Adam Taggart

Following several months of remarkable price appreciation, precious metals (PMs) have been experiencing whipsaw volatility over the past 48 hours. Quite understandably, PM investors (and those thinking about becoming ones) are trying to make sense of what’s next for gold, silver, and the miners. Many of you have written in to us with the questions you’re most interested in getting insight into.

This morning, I spoke with three respected experts in the precious metals field. According to their expertise, I put a brief question to each: 

  • What’s behind the current downdraft in bullion prices? (Ted Butler)
  • Having lagged the increases seen in the metals, are the miners attractive here? (Frank Barbera) 
  • For money looking to enter the PM market, is now a good time to enter? (John Doody)

Here is the summary of their responses:

What The Recent Volatility In Gold and Silver Means
 PREVIEW by Adam Taggart

Following several months of remarkable price appreciation, precious metals (PMs) have been experiencing whipsaw volatility over the past 48 hours. Quite understandably, PM investors (and those thinking about becoming ones) are trying to make sense of what’s next for gold, silver, and the miners. Many of you have written in to us with the questions you’re most interested in getting insight into.

This morning, I spoke with three respected experts in the precious metals field. According to their expertise, I put a brief question to each: 

  • What’s behind the current downdraft in bullion prices? (Ted Butler)
  • Having lagged the increases seen in the metals, are the miners attractive here? (Frank Barbera) 
  • For money looking to enter the PM market, is now a good time to enter? (John Doody)

Here is the summary of their responses:

Image | On the Airwaves and InterTubes
On the Airwaves and InterTubes
by Adam Taggart

With the launch of the new book, Chris has been busy delivering the Three E message to a media slowly awakening to the severity of our predicament. Recent world developments (spiking silver/gold/oil/food prices, a plummeting US dollar, renewed PIIGS debt concerns, MENA unrest, and Japan’s woes, to name just a few) are sobering signals that we are far into the timeline that the Crash Course has predicted.

I thought I’d compile some of Chris’ more recent and notable media appearances for those who may not have seen them yet.

BNN

This morning, BNN – Canada’s Business News Network – aired this interview with Chris discussing the implications of the coming energy crunch (click image to launch the video):

height=

On the Airwaves and InterTubes
 by Adam Taggart

With the launch of the new book, Chris has been busy delivering the Three E message to a media slowly awakening to the severity of our predicament. Recent world developments (spiking silver/gold/oil/food prices, a plummeting US dollar, renewed PIIGS debt concerns, MENA unrest, and Japan’s woes, to name just a few) are sobering signals that we are far into the timeline that the Crash Course has predicted.

I thought I’d compile some of Chris’ more recent and notable media appearances for those who may not have seen them yet.

BNN

This morning, BNN – Canada’s Business News Network – aired this interview with Chris discussing the implications of the coming energy crunch (click image to launch the video):

height=

Image | Simon Black: The Most Sound Opportunities Are Outside the Western World
Simon Black: The Most Sound Opportunities Are Outside the Western World
by Chris Martenson

"In the long run, as decades of capital misallocations and inefficiencies in the global economy get shaken out, there’s going to be a redistribution of the wealth. And I think the wealth is going to go to where it’s treated best.

And at the end of the day, that’s really what I’m looking for: the places that have the most solid fundamentals and the best growth potential."

So states Simon Black, who travels the world (over 20 countries in the past 3 months) in order to assess and report on the investment and lifestyle opportunities offered by various international destinations for the readers of his blog, SovereignMan.com. His boots-on-the-ground observations lead him to conclude that there are a number of resource-rich and fiscally sound developing nations that are much better positioned to meet the future than the US and its developed counterparts. Smart investors, in his opinion, can't afford to ignore the stability and returns (both financial and lifestyle) that these countries offer. They should be asking themselves: Do I have sufficient exposure to these opportunities?

Click the play button below to listen to Chris' interview with Simon Black (runtime 33m:25s):

[swf file="http://media.PeakProsperity.com/audio/simon-black-2011-04-28-final.mp3"]

Download/Play the Podcast
Read the Transcript of the Podcast
Report a Problem Playing the Podcast

In this podcast, Simon details:

Simon Black: The Most Sound Opportunities Are Outside the Western World
 by Chris Martenson

"In the long run, as decades of capital misallocations and inefficiencies in the global economy get shaken out, there’s going to be a redistribution of the wealth. And I think the wealth is going to go to where it’s treated best.

And at the end of the day, that’s really what I’m looking for: the places that have the most solid fundamentals and the best growth potential."

So states Simon Black, who travels the world (over 20 countries in the past 3 months) in order to assess and report on the investment and lifestyle opportunities offered by various international destinations for the readers of his blog, SovereignMan.com. His boots-on-the-ground observations lead him to conclude that there are a number of resource-rich and fiscally sound developing nations that are much better positioned to meet the future than the US and its developed counterparts. Smart investors, in his opinion, can't afford to ignore the stability and returns (both financial and lifestyle) that these countries offer. They should be asking themselves: Do I have sufficient exposure to these opportunities?

Click the play button below to listen to Chris' interview with Simon Black (runtime 33m:25s):

[swf file="http://media.PeakProsperity.com/audio/simon-black-2011-04-28-final.mp3"]

Download/Play the Podcast
Read the Transcript of the Podcast
Report a Problem Playing the Podcast

In this podcast, Simon details:

Image | How to Increase the Energy Efficiency of Your Existing Home
How to Increase the Energy Efficiency of Your Existing Home
by Phil Williams

height=I am an energy auditor and weatherization contractor working primarily in the residential market in Central Pennsylvania. Through a variety of tests, I can tell a homeowner not only what home improvements should be done to improve the efficiency of the home, but also what the return on investment will be. Apart from the energy savings, I also pay particular attention to the health and safety of the home.

Energy auditing and building analysis is a fairly new industry. I received my training in Maine, through Maine Housing, and at the Weatherization Training Center at Penn College. I also went through the Building Performance Institute's Building Analyst certification.

I would like to share some of the tricks of my trade with the PeakProsperity.com community. I will also share an average of the return on investments that I have seen on my jobs. As I go through a home, these are the items I typically look at:

 

How to Increase the Energy Efficiency of Your Existing Home
 by Phil Williams

height=I am an energy auditor and weatherization contractor working primarily in the residential market in Central Pennsylvania. Through a variety of tests, I can tell a homeowner not only what home improvements should be done to improve the efficiency of the home, but also what the return on investment will be. Apart from the energy savings, I also pay particular attention to the health and safety of the home.

Energy auditing and building analysis is a fairly new industry. I received my training in Maine, through Maine Housing, and at the Weatherization Training Center at Penn College. I also went through the Building Performance Institute's Building Analyst certification.

I would like to share some of the tricks of my trade with the PeakProsperity.com community. I will also share an average of the return on investments that I have seen on my jobs. As I go through a home, these are the items I typically look at:

 

Total 6301 items
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