I read books that predict events that eventually came true. Right now, I'm reading Murry Rothbard's "America's Great Depression" and John Talbott's "Sell Now! The End of the Housing Bubble." I also listen to Kitco News and Stansberry Research on Youtube. Listening to these experts describe history, I think we can paint a pretty clear picture whichasset classes will rise and fall based on other occurrences.
- Stock Market - It's right around its all time high, even if you factor for inflation. This is high because of all the free/cheap money going around for the past few years. Much of that money plus all the stimulus is eventually going to find its way into the stock market, where companies such as Rivian, who have only produced 300 cars to date, are worth more than Ford and GM combined. We've also see an increase in "trendy" investments. Once Trump took office I've seen a lot of this hive mentality. Everyone gets together and says, "We hate rich people but we love Apple let's buy their stock!" and it is done and the trendy stocks rise (I even see this with movies: doesn't matter if it's a good movie or not because people are now rating the movie based on other peoples reviews!) Some of these "trendy" stocks could easily lose 80% of their value during the next crash. Even Apple, Amazon, Microsoft could drop 40%. My plan: sell now and buy back after the next crash.
- Real Estate - Much of the same as the above with even more of the "trendy" nature. The more "normal" the house, the less it has gone up in value since its 1997 high (I don't count the 2008 highs because that was also a bubble built with fake money loans to fake qualified buyers). Bankers obviously targeted the areas with more people and also pricier houses which, are usually the same areas, thus, some "trendy" areas have gone up 300% since the 1997 high. Normal areas not as much increase due to fake money so not as much to lose in the next crash. Remember, the fake money usually goes to the rich, so, the asset bubbles begin with what the rich people buy. So it might be best to sell or refinance your house now. Buy a new house after the crash.
- Precious Metals - JP Morgan/Chase paid $1B last year for manipulating the precious metals market, but it was on such a hush hush that it slipped my radar until over one year later! Silver could easily reach $100/oz or more if Sony or Toyota decides they want to buy a one-year supply at these prices and have it delivered. They don't do that though, they buy the contract while the silver is still in the ground, getting "just-in-time" delivery. The market is very, very tight. Palladium went high and Platinum went down over the past 10 years, likely due the fact that you can substitute one for the other in automobile production. Platinum is probably being used more now because it's cheaper. Will it rise? I think so. Gold will retain its purchasing power, as it has for 1000s of years, but I won't buy too much. Precious metals will crash with the market but not as much, then they will likely come roaring back, so quickly you might not have to buy after the crash. Also watch mining stocks. High upside.
- Commodities - all will probably rise from here, crash or no.
- Cryptocurrency - I predict it will as far if not farther than "junk" stocks. Bitcoin at $20k, some of those trashcoins will be at 90% value. But, there isn't much history to show what will happen, but, I think crypto will come roaring back: slower than metals and commodities but faster than stocks (the crypto market is still $3T, precious metals like $12T, and stocks like $60T, give or take). Some people are viewing it as a store-of-value, others view it as a pyramid scheme. I own some, but I know it could go to $0. During the crash I will buy more!
- Cash - its value is eroding due to over-printing. But, the credit default swap market, derivatives, and bank lending creates so much money that when the market crashes all of this funny money will dry up (it's like $trillions and trillions) and everything else will deflate (crash), and you'll wish you had a stack of cash. Warren Buffett now has the biggest stack of cash ever.
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