Economist John Williams is putting out a rare “Alert” on his popular ShadowStats.com newsletter. What does Williams see that scares him? Williams explains, “There are several factors. Number one, I think we are at risk of an extreme market reaction just tied to the economy slowing down unexpectedly against headline expectations. That is going to mess up the Fed’s planning for raising rates and liquidating their balance sheet. That is going to force them back to quantitative easing (money printing). That, in turn, will savage the dollar. As the dollar plummets, so will U.S. stock prices. They are heavily supported by the influx of capital from abroad. . . . Given the underlying fundamentals in the markets and in the economy, I think all the components are in place for one of the great financial panics of all time.”
Williams says this is why gold is poised to go up. Williams says, “Gold is the ultimate hedge against all the craziness in the world and very bad financial markets, dangerous currency markets and bad inflation. Physical gold is the ultimate hedge because it retains its value over time. . . . I have been looking for it to go higher, and it is going to go a lot higher as the circumstances deteriorate.”
At some point, Williams says, “You are going to see a plunge in the dollar. . . . All of a sudden, they are going to stop raising rates . . . and as the economy deteriorates and puts more financial stress on the banking system, they’ve got to go back to quantitative easing. They can’t let the banking system fail. They have propped up the dollar, but you are going to see a plunge in the dollar. The fed does not have to actually move to quantitative easing for the dollar to tank, you just have to have the markets shift in sentiment to that effect, and you will see the dollar tank.”
Williams says, “A big factor in the dollar’s value is political stability or the perceived political stability. Right now, you have a circumstance in Washington where there is tremendous political discord. I can’t remember seeing anything like this in the past. The President has effectively had his options shut off in terms of moving the economy. I was looking for him to get elected because of the weakness in the economy. . . . This intensifies the problems for the economy, but I can tell you right up front it’s a big negative for the dollar. . . . If you have a move for impeachment for the President, that will tank the dollar.”
What does John Williams’ gut tell him to do before this Fall? Williams says, “I would be out of the stock market, and I’d have my money in gold. I mean physical gold, physically owning the gold. . . .Suppose the things I am looking for begin to break. You may see rioting in the streets. You may see disruptions in the supply chains to grocery stores.”
Join Greg Hunter as he goes One-on-One with economist John Williams at ShadowStats.com.
There is some free information on ShadowStats.com. Economist John Williams also puts together detailed reports on all aspects of the economy without accounting gimmicks to make things look better than they actually are. For example, if unemployment was calculated the way the government did it before 1994, it would show a 22% unemployment rate. Williams gives what I call the “real stats” in his weekly reports. Click here to subscribe.
Greg is the producer and creator of USAWatchdog.com. The site’s slogan is “analyzing the news to give you a clear picture of what’s really going on.” The site will keep an eye on the government, your financial interests and cut through the media spin. USAWatchdog.com is neither Democrat nor Republican, Liberal or Conservative. Before creating and producing the site, Greg spent nearly 9 years as a network and investigative correspondent. He worked for ABC News and Good Morning America for nearly 6 years. Most recently, Greg worked for CNN for shows such as Paula Zahn Now, American Morning and various CNN business shows.