Robert Prechter - Economic Crisis Part 1 of 2

[VMA225]

Your right, Totally Corrupt !!!

[reverenceforall]

If predicting the market were a function of IQ then all our problems would have been solved by now.

[FreeTheNation]

@reverenceforall

I wouldn't call what he does "predicting." Prechter is a long-term forecaster. If you read his book from 2001, he has hit the nail on the head.

[reverenceforall]

@FreeTheNation Yes you are right, however forecasting techniques for the financial markets are like forecasting the weather. Intelligence is not a factor because no matter how intelligent you are you are, if you use the same techniques you will have a similar degree of "predictability" with them.

[FreeTheNation]

@reverenceforall

I don't agree with that statement. Intelligence has a great deal to do with forecasting. Prechter's mathematical techniques are unique and few people could even begin to use them. You should research his website and his book. If forecasting financial markets were like the weather, there would be just as many "weathermen" as Prechter. When he wrote his book, most wrote him off as a nut. When you are called a nut for being ahead of the curb, you are a genious.

[reverenceforall]

@FreeTheNation Well a technique is a tool like a computer is a tool. A technique doesn't grow more intelligent with time unless changes are made to it. All techniques become outdated over time. In this economy, I am afraid that the predictions or forecasts are not very useful no matter how intelligent their inventor. There is no historical event that can be compared to what we see today. Even in countries with hyperinflation in the past, their debt was not so massive as to be insurmountable.

[reverenceforall]

@FreeTheNation Also there are many people forecasting the state of the economy, You Tube is full of them though I grant that they may not be as common as weathermen. The techniques of forecasting the state of an economy cannot take into account the many variables that are as yet unknown. And we cannot make the unknowable known by tools that must by their very nature must be based on history.

[FreeTheNation]

@reverenceforall

I would recommend that you read his book "conquer the crash" written in 2001.

It was groundbreaking at the time. It's one thing to forecast things post 2007, it's another to have been 10 years ahead of the curve.

[FreeTheNation]

@APRtunedAudi

The use of the word moron is extreme/disrespectful. Robert Prechter is one of the most intelligent men alive. He wrote a book in 2001 about everything that is happening around the world today.....and most, if not all, of his forecasts have come true. Finally, there is MASSIVE deflation in the world. That is the ENTIRE point of the 11 Trillion dollars you are referencing. The Spending and printing of the money is the REACTION to the deflation that we are experiencing.

[HighLevlGamers]

he dose know that the economics of the downgrade weren't there right? the only reason they did it was because of a bunch of nut jobs that tied the Dsiling to date reduction during a time of economic turmoil witch is the dumbest thing ever, plus they also said that it must include tax increases and not just spending cuts. a balanced budget amendment is the stupidest idea ever......it dose not work and it actually causes tax increases. and repealing the income tax would get usdowngraded agin

[FreeTheNation]

@HighLevlGamers

The US will either balance it's budget over time or we will face an economic collapse. Taxing personal income is against the entire principle of Freedom and it is immoral. It causes distortions in our political system and creates nothing but problems. Less than 50% of revenues come from income tax and can easily be made up from taxes on other things. The legalization of drugs may create enough revenues, singularly, to make up for the shortfall. -continued-

[FreeTheNation]

@HighLevlGamers

-continued-

We are currently experiencing the CONSEQUENCES of deficit spending and the progressive income tax....where less than 50% of the population actually contributes. We have 50 million people on food stamps and a government that is twice the size it was only ten years ago. The entire system needs to be torn apart and built based upon the CONFINES OF THE CONSTITUTION. The budget can be balanced over time. That ALONE will solve most of the problems.

[PureLiberalFire]

"...a gov't completely insane and corrupt." And tyrannical.

[getbo]

@APRtunedAudi @APRtunedAudi How is that inflation trade working out now? FYI Prechter is a member of Triple Nine Society - members have minimum IQ of 150 - he is obviously not a moran. Evidence abounds that deflation is occurring worldwide - here in the States M1 is contracting. If you're on the inflation bandwagon - you will be soon be driving an old volkswagon not an Audi.

[getbo]

@APRtunedAudi - Prechter is a member of Triple Nine Society - members have minimum IQ of 150 - he is obviously not a moran. Evidence abounds that deflation is occurring worldwide - here in the States M1 is contracting. If you are not protecting your assets against deflation - you will be soon be driving an old volkswagon not an Audi.

[srm2k]

The debt chart shows a parabolic rise. Like the Nasdaq and crude futures, such profiles always resolve with a near identical slope to the downside.

[mustang607]

Ignorance breeds the evils of collectivism.

Those of weak ethics and morality have little problem looting us as well as passing on the accumulated effects of their collectivist crimes unto our unborn children. After all, the unborn can't vote.

Socialism is a great ideauntil you run out of other peoples money

[FreeTheNation]

Exactly. I have a plan that includes TWO AMENDMENTS to the Constitution that will protect us from these guys:

1. Balanced budget Amendment - No exceptions unless we are under direct, military attack...and then, it must be a specific amount of money for a specific purpose and period of time.

2. Until we can repeal the Income Tax, put a MAXIMUM ceiling on tax rates in the Constitution. For example, NO tax rate on any person may exceed 25%.

Those two things will stop the insanity.

[TheMobocracy]

The alternative is letting people lose money by not covering deposits through the FDIC. Letting all the banks that got bailed out go bankrupt, making huge budget cuts across the board and telling the average person they have to pay more in taxes beause the Chinese, Japanese, ect.. want their money back.

That's just not going to happen. There is no historical example of government willingly giveing up gloabal dominance. Every empire in history has fallen due to the destruction of the currency.

[FreeTheNation]

@TheMobocracy

The FDIC is a JOKE and a massive fraud that could pay no more than a fraction of deposits. The banks shouldn't have been bailed out and they should have been forced to foreclose on property owners. That would have deflated the real estate bubble, allowing prudent investors to buy back the bad assets. We would have had a depression, but it would be on the way back to a healthy economy. Instead, we have a much bigger crisis looming.

[TheMobocracy]

The FDIC went bankrupt last year. Social Securtiy is now siphoning money out of the general fund. There is no political will to fess up to these huge problems like these. Instead the politicans will continue kick the can down the road economics and borrow more and more money. When they can't borrow anymore Bernanke will print. A time will come when foreign government are no longer willing or able to buy US debt. That's when the real fun begins.

[FreeTheNation]

@TheMobocracy

I couldn't agree more.

However, the TEA PARTY movement gives us hope. I think the American People are waking up and will DEMAND balanced budgets....even if some of us have to sacrifice our social security benefits or go down with the banks.

It's a war for financial independence.

Thanks for the articulate and intelligent input on the channel.

FTN

[TheMobocracy]

I'm not sure what will come out of the Tea Party movement. I don't think much will change untill there is a large turnover in Washington. Typically over 90% of incumbants are re-eleced. I think also there will have to be a major shift in peoples ideas about what the role of government should be. A real ideological shift would be pervasive and would effect both parties much like Keynesian economics

[FreeTheNation]

I think the tea party movement, as scattered as it is, will end up being a force to contend with.

You have to figure that something this big hasn't happened since the great depression.

Let's hope that Americans will wake up and demand that government balance the budget and shrink from interference in our lives.

[TheMobocracy]

Hyperinflation is a currency event not an economic event. It results when confidence in the currency is lost.

[FreeTheNation]

@TheMobocracy

THIS IS AN INCORRECT STATEMENT. Inflation and Hyperinflation are, by definition, an increase in the money supply. It has nothing to do with confidence or a lack thereof.

What you are referring to is a banking collapse,,,,which is caused by a loss in confidence in the banking system. This causes a run on the banks. Due to the fractional reserve system, they can not pay the depositors their money

[TheMobocracy]

In every case of hyperinflation confidence in the currency is completely lost. There is no historical example where this is not the case.

Krugman, Bernnanke along with most of academia believe that inflation is good is deflation is bad. They also define inflation as rising prices. Bernanke is also on record to be willing to create inflation at all costs. QE to infinity here we come.

[TheMobocracy]

Prechter called the "top" in gold at like $400 8 years ago.. I have a hunch that he was a little off. After this aired it went as high as $1,200. Oops!

[FreeTheNation]

I didn't see that in his book....

where did he make that call.

[FreeTheNation]

@TheMobocracy

I don't know about the context of that call. Prechter is a Big picture thinker. The predictions oulined in Conquer the Crash in 2002 have by and large come true. He insists we have a long way to go. He is not down on owning gold...but he does think there will be a better buying opportunity for gold before the inflation hits. We won't know if he's right until 2012-2016.

[TheMobocracy]

Well if the S&P hits 850 or 800 Bernanke will just print more money and if that doesn't push up prices he'll print more. If that then fails he'll print more. If that doesn't work he'll print more. QE to infinity if necesary. Paul Krugman has written that world central banks dumping dollars would be a good thing because it has the same effect as QE. China holds more dollars than anybody and they are looking also to buy gold. India just bought 200 metric tons from the IMF.

[FreeTheNation]

Paul Krugman doesn't know how to use toilet paper, let alone a thing about economics. I know people like him who have TONS of awards and degrees.....Most of them couldn't run a hot dog stand...and neither could Krugman,

Keynsian Economics is a complete and utter pile of Horse Crap.....It's the KING PILE OF CRAP OF ALL PILES OF CRAP in the world.....and responsible for the mess we are currently in.

[bestgtor22]

This guy will be proven right for the most part just like Roubini and them on the start of the economic crash.

[rblackbelt1]

Still waiting for bearish sentiment to return as the markets behave as if everything was on the up and up with no more concerns about credit contraction, commercial real estate, bankruptcies, derivatives, etc.

[FreeTheNation]

I can't really disagree with you. I will add that Schiff has been pretty much dead on....in a practical sense. When I asked peter schiff about credit deflation, he responded "Congress will deposit a million dollars in everyone's bank account as a "Stimulus" before they allow that to happen." He was obviously being sarcastic, but they DO have the largest printing machine in the world.

[rblackbelt1]

Schiff is intelligent but Prechter is genius. Prechter's call on commodity price deflation worked in 2008, whereas Schiff did not account for mass liquidation of commodities and other liquid assets due to deleveraging as well as worries about derivative based commodity ETFs when AIG was a candidate for bankruptcy.

[FreeTheNation]

Some Viewers have been accusing me of being REPUBLICAN (LOL)...and others want me to admit being a LIBERTARIAN (yes-it would be fair to say I have Libertarian Leanings) However, I am Neither for two important reasons.

1. I believe that organized parties contribute to corruption...as we have just witnessed with the Senate Health Care Bill.

2. I will support any politician who supports the Constitution, as it was written, regardless of their party affiliation.

[30percentplusreturns]

People think there is inflation because they see gold going up but they fail to realize gold was severely undervalued to begin with and that people arent buying gold because of inflation, but because of a loss of confidence and problems with counterparty risk. There will be a massive debt implosion in 2010 with more foreclosures and the commercial real estate market collapsing. This is hugely deflationary.

[Nuanceqwest]

I'm a bit biased here because I like Prechter's work but, somebody clearly does not like Prechter, because on the day after he announces that he is getting more aggressive, the dollar has its largest single day decline this year.

You know, someone is gunning for his account because all the other carry trades were recoiling and the financials were going down especially in a liquidity driven market.

BTW, still think that dollar is going to rally 2010 big time soon as well.

[30percentplusreturns]

At first I was one of these hyperinflation hacks, but now I totally agree with prechter. There will be a huge debt implosion which is massively deflationary. Just look at dubai recently. This will ripple through the emerging markets and countries will scramble for dollars. Also, prechter has a great record behind him and won the US trading championships with over a 400% gain. I think ill listen to him instead of journalists.

[Nuanceqwest]

Me too, I was an inflationist at first then I did some basic figures on deficit spending and GDP compared to the stimulus and the deeper I looked the more I realised how wrong the crowd is Prechter seems to have the best handle on what is going on.

But there is often very little you can do or say to an inflationist to change his mind that could imply that we are headed for another crash because when the message does hit home it is going to be a horrible day, not sure how to describe it.

[herbs814]

the case for deflation acknowledges how severely our currency has already been inflated... and questions how much further inflated it can get in the future. there is a limit to how much higher prices people will agree to pay, how much higher businesses can pay suppliers and employees, how much more debt can be sold when a backlog of debt and continuous deficits throws repayment into question.

[Coreadrin]

frank299 - EWI in early april called for a rally to 10,000 in the DOW

[frank299]

Where is the proof. I have video proof from march where he says cover shorts, neutral on equity - not bullish, gold topped.

Please provide the proof. Thanks

[BringBackCapitalism]

Right on Bob! You're helping a lot of smart people make sound decisions.

[luvzpalin1]

bob is so right on, thanks for the posting

[30percentplusreturns]

Prechter is really damm good and actually makes a great case against guys like schiff.

[Nuanceqwest]

I agree 30percentplusreturns,

I think that Prechter has the edge over Schiff because Schiff is more of an academic which scares me. Because academics do not pay enough attention to the human psyhcological condition and how they will behave.

Prechter incorporates more mass psychology into his economic analysis than Schiff.

That is why I am biased towards Prechter's analysis.

[frank299]

Prechter turned neutral in Feb. He did not suggest to buy stock. He sugested for for shorts to cover. Media likes to glorify bs.

[gaiisk]

where's part 2???

nice vid though!

[FreeTheNation]

coming up soon