Greg Weldon on CKNW Money Talks

Greg Weldon of WeldonOnline shared his views on CKNW yesterday at 9AM. If you have never subscribed to his money monitor, metal monitor or ETF monitor, I strongly recommend you give it a try via the free trial. Greg is one of the few independent financial analysts I respect. He correctly predicted this crisis long before our government officials, central bankers and financial media got out of their denial. He provides extremely specific short-term and long-term analysis.

Here is a quick summary:

  • We are not out of the woods. The stock market has lower to go even though we may see bear market rallies in the order of 20/25% with the U.S. election “acting as a catalyst of hope”. What we are experiencing is a reversal of a 40-year credit expansion. The U.S. consumer is howing increasing sign of stress: more unemployed, longer unemployment, much more partially unemployed. There is no sign for a major wealth reflation on the horizon.
  • What to do from a personal investment standpoint: Be much more personally involved. The old investment models like the buy and hold mentally don’t apply anymore. Be more flexible, diversified and have a nimble investment approach. Be involved in all asset classes, globally and be much more specific. Long in some assets and short in others at the same time.
  • So far the massive efforts of central banks haven’t been very successful, so we don’t know if this situation will end up into hyperinflation or ugly deflation.  There is still a lot of fire power held by central banks, so we can expect a much bigger effort in terms of monetary policy (see upcoming G20 meeting mid-November).
  • At some point, if/as more and more bail-outs are provided, the credit-worthiness of the U.S. could be questionned.

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