Richard
Russell: “Today's investors are in a most unusual
position. I say that because I believe we are close to witnessing and living
through some of the greatest and momentous changes in world economic history.
It will be, historically, tantamount to those of us who fought and lived through
World War II.
The two biggest items in
America's economy are (1) Federal Reserve notes, which we laughingly call
"dollars." These notes currently serve as the world's reserve currency. (2)
The US bond market, by far the single biggest securities system on the planet --
it includes trillions of dollars worth of Treasuries, corporate and municipal
bonds, and various other debt securities.
It is my opinion that within the
next year or possibly two years, the dollar will lose its reserve currency
status, and the US bond market will crash, taking the stock market with it. I
include below a chart of the US dollar -- the chart goes back to 2008. The
chart depicts a series of declining tops. Declining tops describe a period of
ebbing upside momentum - and ebbing upside momentum is always
bearish.
The chart below tells me one
thing -- the world is cautiously and steadily moving away from dollars. We hear
about nations agreeing to trade with each other in their own currencies (in
order to avoid trading in dollars). We hear about nations moving dollars out of
their reserves. I'm predicting that these bearish (for the US) trends will
accelerate. These trends are forecasting the end of the US dollar as a wanted
store of value..."
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