Greyerz – Expect Crisis In World Stock Markets, Global Economic Depression And Despite Volatility, Skyrocketing Gold & Silver Prices

Today the man who has become legendary for his predictions on QE and historic moves in currencies and metals warned investors to expect a crisis in world stock markets, global economic depression and despite volatility, skyrocketing gold & silver prices.

August 9 (King World News) – Egon von Greyerz:  Two major asset classes are major beneficiaries of the unlimited money printing and credit creation that is now taking place globally. One of them will end in tears and the other one has just started a major secular bull market.

As the world economy and financial system is disintegrating, investors are under the illusion that all is well with many stock markets still not far from their all time bubble highs.

THE DISCONNECT BETWEEN STOCK AND THE REAL ECONOMY CONTINUES
Many companies and services are hemorrhaging cash and are not going to recover for years, some never. As very few people are travelling, many airlines, cruise lines, hotels and restaurants, for example, will not survive. This is a global industry that employs 330 million people and represents 10% of global GDP. International tourism could fall as much as 60-80% in 2020 according to some estimates.  The car industry is 3% of global GDP and is expected to drop 25% in 2020.

Real and hidden unemployment is a major problem and if furlough or social benefits are stopped, many people will not survive. As many can’t pay their rents they will also become homeless.

Currently 31 million Americans are on some kind of unemployment benefits. That is 20% of all workers. But if we include workers who are not receiving any benefits the total unemployment is 30% according to Shadow Government Statistics. This is worse than in the 1930s depression.

Real Unemployment Worse Than The 1930s Depression

DREAMLAND STOCK INVESTORS IGNORE DEFICITS
Stocks market investors still live in Dreamland and translate all the bad news to good news as the continuous flood of printed money and credit inject liquidity. This has always worked before so why won’t it this time? No one knows what the US deficit will be at the end of calendar 2020, but it could easily be $10 trillion as the debt grows to over $30 trillion on to $40 trillion within a year or two. 

How wonderful for stock investors. More liquidity means higher share prices. Very few understand that all this money has zero value as it has been created out of thin air. Also, none of the money goes to productive investments, but instead just to give a dying economy some temporary artificial respiration. So the worthless money will go to individuals and businesses just to survive. It will also in ever bigger quantities go to an extremely fragile financial system. In the end $100s of trillions and later quadrillions of dollars of worthless money will have been spent on non productive survival aid……more here

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