Jason Moran
Thursday, October 23, 2008
  Market Predictions From Grandpa

Grandpa Bouchard stopped in town yesterday seemingly to rave about the stock market, cycles, charts, patterns, and the idiots of the world. Grandpa is retired now, but he has been a broker among a myriad of other things. He has spent 10-16 hours per day for 60 years researching the market - and he has some pretty strong opinions.

He said just about everything fits into one of 16 (or so) patterns and it is so easy to predict what will happen next if you identify the right pattern.

One of them is a depressionary cycle that was supposed to hit a year ago. He told us to get our money out of the market and even to get it out of banks. He was a year off, but it was a 240 year cycle leading into a depression that he identified quite a while ago and it is hard to get down to exact dates when the cycles are that big. Of course it is cool that his predictions are starting down the path that he felt they would, but if he continues to be correct then things will get far more scary than they are now.

Grandpa told me (with crazy eyes) WAIT FOR GOLD TO HIT $650. As in, he's positive gold will continue to drop in price at least to $650 per ounce. Once it does then I should buy up gobs and gobs of it because it will go through the roof for years and years.

So, why are precious metals dropping in price even though demand is through the roof? Have my lessons in economics been a complete waste? He says this: Hedge funds and the other very large owners of gold and silver have to sell now because they need cash to stop the bleeding - that is helping to drive the price down over demand because they are bigger players. They should be all sold out soon which is when those with demand (regular people) will start getting their hands on it...and when prices will skyrocket.

Overall Grandpa B is worried about having almost anything sitting in the stock market as a whole. He is actually serious when he says this will be a Great Depression unlike the 1929-1932 time period. He thinks nearly every financial institution will collapse and he has asked my cop dad which gun he should purchase to protect his home from the crazies in the coming years.

"A depression is when money goes back to it's rightful owner". - Grandpa Bouchard

Unfortunately my grandpa thinks things will get far more difficult than I can imagine (with me being 28 years old and never having lived through difficult times during my lifetime). However, he believes the U.S. will fair better than most of the rest of the world. Sure, there was a housing bubble in the U.S. with home prices going up an average of four times their value over some number of years I can't remember. However, over that same period England's home prices went up 12 times, Ireland 20+ times! Most countries went up a similar amount. So, if a $100,000 house in the U.S. drops down to it's real value at $25,000 that's pretty tough to deal with. However, in Ireland that $100,000 would drop down to about $4,000! My head would asplode.

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Comments:
Dave Ramsey said all will be fine in the next few months.
 
If you don't carry debt, have an emergency fund of 6 months or more, and have paid off your house... sure, everything will be fine.

As a conservative person and a Christian steward of God's resources, I place great stock in Dave Ramsey's viewpoints. They're largely "incompatible" with the advice of many (most) financial advisors. Then again, most financial advisors are morons who happen to have a college degree.
 
Housing values/prices? Down. Stocks and Equities? Down. International stocks? Down. Bond funds? Down. Credit and lending? Down. Commodities and precious metals? Down. The world's currencies? Down. The US Dollar? Up.

Hello imports? Hello deflation?

Where's my gun?
 
Oh how people are blinded by a silver tongue, good looks, populist rhetoric, and a celebrity lifestyle.

Barack Obama is a Populist, a Socialist, a Marxist, a Progressive, and is essentially a member of the New Party, a party considered to be far left of the leftmost liberal Democrats.
 
new post! new post! new post!
 
(with fists pounding)
 
So, quite a lot of unspeakables have happened in the last few months. We're ushering in a new financial world order (and it doesn't even seem to matter). What does Pappa Moran say about gold, silver, and *gasp* platinum (currently the same price as gold)?

Was 750 the new 650?

Oh, and ladies, I suggest you go into your nearest jewelry store and berate them over the premiums they charge for platinum jewelry. Platinum dipped BELOW the price of gold this week for the first time in 20 years.
 
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