[excon]

Hello friends:

We're scared. We have no confidence in the markets. As long as THAT'S true, it doesn't matter how much money they throw at the problem. CONFIDENCE IS the problem.

We'd like to think that the problem is being solved because we did GIVE away $700 BILLION. But, it isn't. My job is NOT to scare you further, but only to encourage you to prepare for what's next.

Below are 29 leading indicators I copied from my friend, Jim Sinclair's website. Each problem has one or more possible solutions, but lacks unified political support. Time's running out. We're already at the edge of the Great Depression 2. Add up the trillions in debt: Any collective solution will only compound our problems, because the cumulative debt will overwhelm us, make matters worse:

1. America's credit rating may soon be downgraded below AAA

2. Fed refusal to disclose $2 trillion loans, now the new "shadow banking system"

3. Congress has no oversight of $700 billion, and Paulson's Wall Street Trojan Horse

4. King Henry Paulson flip-flops on plan to buy toxic bank assets, confusing markets

5. Goldman, Morgan lost tens of billions, but planning over $13 billion in bonuses this yea

6. AIG bails big banks out of $150 billion in credit swaps, protects shareholders before taxpayers

7. American Express joins Goldman, Morgan as bank holding firms, looking for Fed money

8. Treasury sneaks corporate tax credits into bailout giveaway, shifts costs to states

9. State revenues down, taxes and debt up; hiring, spending, borrowing add even more debt

10. State, municipal, corporate pensions lost hundreds of billions on derivative swaps

11. Hedge funds: 610 in 1990, almost 10,000 now. Returns down 15%, liquidations up

12. Consumer debt way up, now at $2.5 trillion; next area for credit meltdowns

13. Fed also plans to provide billions to $3.6 trillion money-market fund industry

14. Freddie Mac and Fannie Mae are bleeding cash, want to tap taxpayer dollars

15. Washington manipulating data: War not $600 billion but estimates actually $3 trillion

16. Hidden costs of $700 billion bailout are likely $5 trillion; plus $1 trillion Street write-offs

17. Commodities down, resource exporters and currencies dropping, triggering a global meltdown

18. Big three automakers near bankruptcy; unions, workers, retirees will suffer

19. Corporate bond market, both junk and top-rated, slumps more than 25%

20. Retailers bankrupt: Circuit City, Sharper Image, Mervyns; mall sales in free fall

21. Unemployment heading toward 8% plus; more 1930's photos of soup lines

22. Government policy is dictated by 42,000 myopic, highly paid, greedy lobbyists

23. China's sees GDP growth drop, crates $586 billion stimulus; deflation is now global, hitting even Dubai

24. Despite global recession, U.S. trade deficit continues, now at $650 billion

25. The 800-pound gorillas: Social Security, Medicare with $60 trillion in unfunded liabilities

26. Now 46 million uninsured as medical, drug costs explode

27. New-New Deal: U.S. planning billions for infrastructure, adding to unsustainable debt

28. Outgoing leaders handicapping new administration with huge liabilities

29. The "antitaxes" message is a new bubble, a new version of the American dream offering a free lunch, no sacrifices, exposing us to more false promises

Buy gold.

excon

[tomder55]

You forgot to add the 1% cent drop in the U.S. consumer price index on Wednesday .How will gold help you during a deflationary cycle ? I guess if the price drops at a lower rate than other commodities and prices then it acts as a safe haven because you are relatively still ahead of the game .

[excon]

How will gold help you during a deflationary cycle ?

Hello tom:

It won't. But, I believe the jillions of dollars they're throwing at the problem, will ultimately STOP the deflation. THAT'S what THEY'RE hoping for. I, however, think it will go far beyond STOPPING the deflation. I think it'll begin an inflation in 2010, the likes of which we've not seen since the Wiemar Republic.

If I'm right, gold will trade at well beyond $2,000 per ounce. If I'm wrong, it could be $35 again.. But, it's going to be one or the other. I just happen to think inflation will win out.

excon

[inthebox]

Well, at least gas is down below $2 / gallon.

Not to worry though, Obam, Pelosi, Reid, Frank et al will save us!

[twinkiedooter]

Well, at least gas is down below $2 / gallon.

Not to worry though, Obam, Pelosi, Reid, Frank et al will save us!

Save us? Save us from what? Them? Them would be the only answer that makes sense. Pelosi hasn't a clue. Rhambo hasn't a clue how to save anybody. Hilldog as Secy of State? Now that's an interesting thought. She'll be right at home with all of the old dogs left over from the Slick Willy regime err I mean presidential term.

And gas needs to bottom out at 45 cents a gallon. That's what it was back in the 1970's. That's enough for a gallon of gasoline.