Does the age-old "Buy & Hold" mantra still apply?
Based on historical performance the answer is 'Yes'...however some see things differently:
Financial expert Bill Holter says the "ability to prevent a crash no longer exists."
"The system has gotten too big...there's too much debt. Too many sovereign governments have bumped up against debt saturation. In the U.S., we are over 100% debt to GDP."
Holter believes the credit bubble was "pricked" this week and no matter how things play out in the very short term, the September/October time-frame looks like a disaster.
"You can't fix debt with more debt--but that's what they keep trying to do," he said. "What we need is a complete reset."
Holter's advice? If we get a bounce in the market, use it to get out.
Chris Martenson, of Peak Prosperity, has these words of wisdom: "What goes up must come down--and that's especially true for the world's many poorly-constructed financial bubbles, built out of nothing more than gauzy narratives and inflated with "hopium"..August, it appears, is the new October."
"Markets are quite possibly in crash mode right now, although events are unfolding so quickly--currency spikes, equity sell-offs, emerging markets routs and dislocations and commodity declines--that it's hard to tell for sure. However, that's usually the case right before and during big market declines," say Martenson.
"Further, most of the gains in financial assets engineered by the central banks were false and destined to burst because the were based on bubble technology, not actual returns."
Jim Rickards, author of The Death of Money, explains why China was unable to keep their limited free market under control: "...markets have a mind of their own," he says. "But the 'Empire' will strike back, they have an enormous arsenal of tools they can use to try to fight the bubble."
Good to know somebody is trying to fight the bubble, because according to Rickards, the U.S. Federal Reserve is now out of ammo and on a "Kamikaze Mission."
So, should we 'buy & hold' or jump out & run?
Your guess is as good as ours.
A wise(?) man once said: "This is a pre-crash, and we are not making it through September without the real thing." --Jim Sinclair, gold expert
"For what will it profit a man if he gains the whole world, and loses his own soul? Or what will a man give in exchange for his soul? For whoever is ashamed of Me and My words in this adulterous and sinful generation, of him the Son of Man also will be ashamed when He comes in the glory of His Father with the holy angels." Mark 8:36-38News:
- The New York Times: Signs, Long Unheeded, Now Point to Risks in U.S. Economy; "Once you encourage an equity bubble, it will collapse--and then you're really in trouble," says financial strategist Albert Edwards of London. "This was utter madness."
- CNBC: The New York Stock Exchange invoked the little-used Rule 48 to pre-empt panic trading for three days in a row; move historic.
- The Washington Free Beacon: Iran Renews Support for Hamas and Other Anti-Israel Terrorists Groups.