#1 Bitcoins
As I write this, the price of Bitcoins has
fallen
more than 70 percent from where it was on Wednesday.
This is one of the reasons why I have never
recommended Bitcoins to anyone. Yes, alternative currencies are a good
thing, but there are a lot of big problems with Bitcoins.
-
Why would anyone want to invest in a
currency that could lose 70 percent of its purchasing power in
just two days?
-
Why would anyone want to invest in a
currency where a single person can arbitrarily decide to suspend
trading in that currency at any time?
An article
by Mike Adams of Natural News described some of the things that we
have learned about Bitcoins this week...
-
The bitcoin infrastructure cannot
handle a selloff. Once the rush for the exits gains momentum, you will not be able to get out. Only those who sell early
will be able to exit the market.
-
The bitcoin infrastructure is
subject to the whims of just one person running MTGox who can
arbitrarily decide to shut it down whenever he thinks the market
needs a "cooling period." This is nearly equivalent to a
financial dictatorship where one person calls the shots.
-
Every piece of bad news will be
"spun" by exchanges like MTGox into good-sounding news. As
bitcoin was crashing yesterday by 60% in value in mere hours,
MTGox announced it was a "victim of our own success!". So while bitcoin holders watched $1 billion in market valuation
evaporate, MTGox called it a success. Gee, then what would you
call it when bitcoin loses 99%? A "raging" success?
#2 Gold
The price of gold was down
by about 4 percent on Friday.
Gold has now fallen below $1500 an ounce for
the first time since July 2011. Overall, the price of gold has fallen by
about 10 percent since the beginning of the year, and it is
about 22 percent below the record high set back in September 2011.
Yes, the price of gold
is likely being pushed down by the banksters.
And yes, gold is a fantastic investment for
the long-term. But there will be times when the price of gold does fall
dramatically just like we saw back in 2008.
#3 Silver
The price of silver fell
by about 5 percent on Friday. If it falls much more it is going to
be at a level that presents a historically good buying opportunity.
Just like gold, there will be times when the
price of silver swings dramatically. But the truth is that silver is
probably an even better long-term investment than gold is.
#4 Oil
The price of oil declined
by about 3 percent on Friday.
Many will consider this a positive thing,
but just remember what happened back in 2008. Back then, the price of
oil dropped like a rock. If the price of oil gets below $80, that could
very well be a clear signal that a major economic crisis is about to
happen.
#5 Consumer
Confidence
As I mentioned above, consumer confidence in
the U.S. just had its biggest miss relative to expectations that has
ever been recorded.
The following is from an article posted on
Zero Hedge
on Friday...
Well if this doesn't send the
market into all-time record high territory, nothing ever will:
seconds ago the UMich Consumer Confidence plummeted from 78.6 to
72.3, on expectations of an unchanged 78.6 print.
This was not only a 9 month low in the
index, but more importantly the
biggest miss to expectations in recorded history!
#6 Retirement
Accounts
According to Wells
Fargo, the number of Americans taking loans from their 401(k)
accounts has risen by 28 percent over the past year...
Through an analysis of participants
enrolled in Wells Fargo-administered defined contribution plans, the
bank announced today that in the fourth quarter of 2012, there was a
28 percent increase in the number of people taking loans out from
their 401(k) and that the average new loan balances increased to
$7,126 from those taken out in the fourth quarter of 2011 - a 7%
increase from $6,662.
Of the participants who took out loans,
the greatest percentage were to people in their 50s (34.2%),
followed by those in their 60s (28.9%) and then by those in their
40s (27.3%).
The increase among participants in their
50s was nearly double the increase among those under 30.
This is based on an analysis of a subset
of 1.9 million eligible participants in retirement plans that Wells
Fargo administers.
“The increased loan activity
particularly among older participants is concerning because
those are the years when workers can start to make ‘catch-up’
contributions and really need to focus on preparing for
retirement,” said Laurie Nordquist, director of Wells Fargo
Retirement.
#7 Casino
Spending
Casino spending is declining again.
Many people (including myself) would
consider this to be a good thing, but casino spending is also one of the
most reliable indicators about the overall health of the economy.
Remember, casino spending crashed during the last financial crisis as
well.
That is why it is so alarming that casino
spending is now back to levels that we have not seen
since the last recession.
#8 Employment In
Greece
Over in Europe, things just continue to get
worse.
According to numbers that were just
released, the unemployment rate in Greece has soared to
27.2 percent, which was up from 25.7 percent the previous month.
That means that the unemployment rate in Greece rose by 1.5 percent in
just a single month.
That is not just a crash - that is an
avalanche of unemployment.
#9 European
Financial Stocks
European financial stocks have been hit
particularly hard lately. And for good reason actually - most of the
major banks in Europe are essentially insolvent at this point.
This week, European financial stocks fell
to seven month lows, and this is probably only just the beginning.
#10 Spanish
Bankruptcies
According to
Reuters, the number of Spanish companies going bankrupt has risen by
45 percent over the past year...
A record number of Spanish companies
went bust in the first quarter of 2013 as companies remained under
intense pressure from tight credit conditions and meager demand, a
study showed on Monday.
The 2,564 firms filing for insolvency
proceedings in first three months of the year was a 10 percent rise
from the previous quarter and a 45 percent increase on the same
period in 2012, the survey by credit rating agency Axesor said.
#11 Demand For
Energy
Just like we saw back in 2008, the overall
demand for energy in the United States is falling rapidly. There are
some shocking charts that prove this that were recently posted on Zero
Hedge that you can find
right here.
Yes, it is good for people to use a bit less
energy, but it is also a clear indication that economic activity is
really starting to slow down.
But despite everything that you have just
read, the Dow and the S&P 500 have been setting new
record highs. And if you listen to the
mainstream media, you would think that this
stock market bubble can continue indefinitely.
Fortunately, there are a few voices of
reason out there.
For example, just check out what Marc Faber recently
told
CNBC...
In the near-term, the U.S. stock market
is overbought and adding that any more near-term gains portend big
trouble for the market, "The Gloom, Boom & Doom Report" publisher
Marc Faber told CNBC on Monday.
"If we continue to move up, the
probability of a crash becomes higher," Faber predicted in a "Squawk
Box" interview, saying it could happen "sometime in the second half
of this year."
As I have written about
previously, a bubble is always the biggest right before it bursts. I
hope that we still have at least a little bit more time before it
happens, but I wouldn't count on it.
The
economic fundamentals tell us that the stock market should be
plunging, not rising. At some point the boys over on Wall Street will
get the message and the market will catch up to reality very, very
rapidly.
But for the moment, the American people are
feeling really good.
According to
CNN, Americans are now more optimistic than they have been in six
years...
As the stock market continues to show
record highs, the number of Americans who say things are going well
in the country has reached 50% for the first time in more than six
years, according to a new national survey.
