As I mentioned before, I have made many gold and stock market predictions recently that came true, even though at the time some questioned the wisdom in my prognostications. Most of my predictions were made live on national radio. Some of those recordings are archived on my website under the Radio section. I also made some forecasts when I wrote the monthly newsletter. This month, I have listed 8 of my more significant predictions that came to pass, as well as 2 very important new predictions that you don’t want to miss! It could help save you from a financial disaster.
Gold and Stock Market Predictions That Were Correct
The following are just a few of the gold and stock market predictions I made that have since come to light. I am just doing my job and seeing the obvious:
Prediction #1: Bull markets in both stocks and Gold at the same time
In early January 2017 I said we would have a Bull market in stocks, while at the same time a Bull market in Gold and explained why. Each national radio talk show host was surprised. They all asked why both markets would move at the same time and thought this was very unusual. I agreed that this was unusual, but gave the reasons for both moving up at the same time. At the end of 2017, Gold went up 13% and the Dow went up 26%.
#2: The stock and gold markets will be different in 2018 than in 2017
In early January 2018, I said this year’s market would be totally different than 2017 in performance. I said Stock indexes as well as Gold would move up only single digits this year. So far Gold and stocks are down slightly for the year and we are almost half way through, with a significant amount of volatility in stocks.
#3: We will see at least a 10% stock market correction
In early January of 2018 I said we would have a stock market correction of 10%, and possibly more. The Dow corrected from its high in the last week of January by 10%.
#4: There will be a major Bitcoin correction
On December 13th I said Bitcoin is here to stay, but two things are going to happen:
- It is going to have a severe correction since it has had a parabolic movement.
- Also, I said that the U.S. government is going to come down hard on investors of Bitcoin through regulation.
On December 17th, 2017 Bitcoin traded at its highest level at $19,209 and corrected shortly after my prediction. It is currently trading under $7,000 per coin. On February 23rd, 2018 Coinbase, the largest trading platform for Bitcoin in the United States, notified a group of approximately 13,000 of their customers concerning a summons from the IRS regarding their Coinbase accounts. The company fought the IRS summons in court, in an effort to protect its customers from unwarranted intrusions form the government, but lost. Since then, the IRS is expanding from Coinbase to other trading platforms as well as other cryptocurrencies. The IRS is going after investors who are avoiding capital gains using cryptocurrencies.
#5: The Dow will go down due to the Federal Reserve unwinding their balance sheet
In early February I predicted that on the last day of the month or the first or second trading day of the next month, the Dow will go down. I said that this is because of the Federal Reserve unwinding its balance sheet and selling U.S. Treasury’s. I said this will cause a downward movement in stocks until the market factors it in. It has happened every month since my original prediction in the first week of February.
#6: The Petroyuan will compete with the Dollar, not replace it
In early March I predicted that when the Petroyuan would be launched it would initially gather attention and then quietly gain momentum. I said it would not replace the Dollar but rather gather long term momentum and compete with the U.S. Dollar. My competitors and other analysts, who have commented on this, many of those have said this would cause the Dollar to be replaced in a very short period of time. Their aggressive predictions were quite opposite of my conservative view which became reality.
#7: The Dollar Index will increase to around 93
On April 25th, I said we would see a reverse trend happening. When the Dollar index was at 90.77, I was interviewed on TD Ameriprise and was the only contributor to predict the Dollar index would rise and move up in the 93 level. It did that on May 15th, and is currently at 94.07.
#8: Despite increased earnings reports, the Dow will go down several hundred points due to lack of confidence
On Monday April 23rd, on two national radio programs, I said this: “If the earnings report comes out, and investors don’t like what they hear… even if earnings are up, should investors get spooked, you will then see the 10-year yield move over 3%, and when that happens… the Dow will go down several hundreds of points.” Tuesday, April 24th, the very next day, those predictions became reality. The Dow went down over 600 points and closed down 424 points.
Gold and stock market predictions moving forward
I have two major predictions that I am officially making. One is in the near short-term, and the other is about 2 years away, yet with a much bigger impact.
Just like prediction #3, I am predicting another 10% pull back in the Dow. I believe this will happen either this year or the first quarter of next year. This prediction has a rider to it – this is dependent upon Tariffs. I believe they will go into effect on July 6th. As a result of that, there will be more Tariffs. These will be the catalyst to trigger another 10% correction or greater. Recently, the Dow broke through a 200-day moving average on June 25th; the Dow closed lower, falling 328 points – down 1.33% for the day.
Just for simple understanding, a 200-day moving average is a major support level; when broke, it usually causes that market to turn bearish. The Dow had an uncanny streak, not closing below its 200-day moving average for 501 consecutive trading days.
This was the third longest consecutive trading days in the history of the Dow.
The two other longer stretches were a 652-day run that ended in May of 1956, and a 715-day stretch that ended in October 1987, called “Back Monday.” Since we haven’t started an official Trade War as of yet, imagine how the markets will react when we get into that, starting on July 6th?
My longer-term prediction is unfortunately much more ominous.
I am now saying that by the end of 2020 we will have a recession unless the Fed changes course. This will be due to the Fed unwinding their balance sheet while raising rates.
Sometime when we get to 2020 and the Fed lending rate is 3% and they have sold over $1.5 Trillion in Treasuries, multiple bubbles will burst causing a major recession.
You will see stocks fall greater than 20%, which is in addition to the previous 20% already. This could be much worse than 2007. There are billionaires saying such and advising investors to prepare and buy some Gold.
I know as you are reading this many of you will say, but what about the booming economy? What about the tax cuts that will stimulate the economy? What about unemployment being at 3.8%?
Let me help you to understand what Allen Greenspan said: “Bubbles seem to break out again and again yet there is a long history of forgetting bubbles. Once that memory is gone and the bubble breaks, the result is a dramatic 180-degree switch from exuberance to fear.”
Last September, when corporate earnings were up 25% year after year we were having one of the best years for Bull market in stocks in quite a few years. If I would have told you then that in January the market would peak and then go down 10% and not recover for 6 months, you would not have believed me – but that is the environment we are in.
History repeats itself
If we went back to 2007 prior to the Crash, Stocks and Real Estate were booming; it was a very healthy economy. If I would have told you then that something very small in the market place called sub-prime mortgages would be the catalyst to cause a massive global recession, it would have been hard to believe. It was one small factor which would take down two of the oldest brokerages on Wall Street: Bear Sterns and Lehman Brothers.
That in addition, it would cause Fanny Mae and Freddie Mac to become financially insolvent and have to be bailed out by the government, you would have said there is no way that is possible, this is just nonsense and you are crazy!
Isn’t that what happened?
If I would have told you in 1999 when Gold was at the very bottom of the market that the Wall Street Journal would write an article convincing you to stay away from Gold, what would you do?
Let’s take a look at what happened. On October 29th, 1999 the Wall Street Journal wrote an article titled “What’s next for Gold?” and in the article the author wrote, “Gold has lost its luster as stocks have regained center stage.” This article was published at the very bottom of the Gold market at $252, the perfect time to buy. In the next 12 years, it tripled and still has out performed all three major indexes in the last 18 years. If I would have told you then that it was the time to buy Gold, what would you have done: followed my advice, or the Wall Street Journal?
Most investors ignored the obvious and lost out on the opportunity. In my 25 years in the precious metals markets and watching financials, I have never seen so many billionaires (who do not own a Gold company), tell the public to buy Gold in this current economic environment.
Some might say this sounds self-serving, and therefore may dismiss what I see, but they should be reminded that many of my previous predictions that came to pass had nothing to do with Gold. Just as those 8 predictions were very obvious to myself, my two predictions today dwarf my 8 previous predictions by sheer factual data. This story tells the obvious… there will be a flight to safety coming. That safety this time will not be the Dollar, it will not be real estate, it will not be treasuries, it will be the obvious: Gold. As I said before, I would rather be two years too early than two minutes too late. You don’t wait to buy Gold, you buy Gold and wait!