Financial Crisis Of Historic Proportions Is Bearing Down On Us

John MauldinofMauldin Economicslatest research note,Prepare for Turbulence, is excellent and a must read warning about the coming financial crisis. Mind refreshed from what sounds like a wonderful honeymoon and having had the time to read some books outside hiscomfort zonehe has come to the conclusion that we are on the verge of amajor financial crisis, if not later this year, then by the end of 2018 at the latest.

Source:Financial Times

Mauldin isa New York Times bestselling authorand respected investment expert and his excellent analysis concludes with advicetoprepare urgentlyfor thefinancialcrisis of historic proportionswhich isonce again bearing down on us:

You and I can’t control whether banks are ready, but we can control whether we are ready. I am working on a number of fronts to help you. My brief time away convinced me beyond any doubt that a crisis of historic proportions is once again bearing down on us. We may havelittle time to prepare. We definitely haveno time to waste.

His financial crisis warning is important as Mauldin is no perma-bear. Indeed up until now his central thesis was that we were in themuddle through economyand that the U.S. economy and global economy would muddle along and we would avoid a financial crisis. So not only has he changed his central thesis but he has gone from being neutral and mildly positive to being very bearish andconcerned about a severe financial crisis.

Mauldin is a long time advocate of owningphysical goldincludinggold coinsasfinancial insurancetaking delivery and secure storage.

I do not think of gold as an investment.It is insurance for me.I buy a fixed amount of gold nearly every month, no matter the price. I hope the price of gold goes down, because that means I get more coins in the mail to go into the vault. Yes, I take delivery of my gold, and it is near me if I need it.

Contents

Afraid of the Truth

We Couldn’t Take the Chance

Policy Brick Wall

Least-Bad at Best

Getting Out of Dodge

Global Contagion

Barefoot on the Beach

Introduction

The job of the central bank is to worry.

Alice Rivlin

The central bank needs to be able to make policy without short-term political concerns.

Ben Bernanke

from the standpoint of the overall economy, my bottom line is we’re watching it closely but it appears to be contained.

Ben Bernanke, repeatedly, in 2007

Would I say there will never, ever be another financial crisis? You know, probably that would be going too far, but I do think we’re much safer, and I hope that it will not be in our lifetimes,and I don’t believe it will be.

Janet Yellen, June 27, 2017

My good friends, for the second time in our history, a British Prime Minister has returned from Germany bringing peace with honor.I believe it is ‘peace for our time.’Go home and get a nice quiet sleep.

Neville Chamberlain, September 30, 1938

Photo: Monica Muller viaFlickr

The way we assess problems depends on our perspective. People can look at the same set of facts and reach quite different conclusions based simply on their circumstances. This is why it’s good at times to get away from your normal environment. Listen to a wide variety of opinions. Read books outside of your comfort zone. You’ll see things differently when you return.

I had that feeling on returning to the US from Shane’s and my honeymoon in St. Thomas. We’re now officially married, and we thank everyone for the congratulations and kind wishes. I saw a little bit of news while we were there but spent more time just relaxing with my bride and reading books.

Re-entering the news flow was a jolt, and not in a good way. Looking with fresh eyes at the economic numbers and central bankers’ statements convinced me that we will soon be in deep trouble. I now feel that it’s highly likely we will face a major financial crisis, if not later this year, then by the end of 201