Harry S. Dent: ASX to 1000, Gold below $500, Silver below $10

If you think that what he states is at least remotely possible, I still think gold, silver and goods are rationally still going to be the best investment. In the environment he is describing then the only safe haven would be cash as all the "assets" go down in value thus cash proportionately increase in value by purchasing power alone. If the paper currency was backed by gold and was rock solid as money then I would believe what he is saying. But in an environment where paper was near printing press levels, the most rational deduction to such as scenario would be governments printing fiat currency like crazy trying to curb or slow down the public outcry, thereby introducing inflation into the system. If there are any other rational views besides this guy is "dented" in the head. Please explain so I may update my knowledge.

 

Maybe cause he doesn't want silver.

Say you stack baked beans at anything up to $1 per can. I get home brand beans usually because I reckon the factory worker gob in there is the same as in the Watties factory. Then someone tells you that food is gonna crash and a can of beans might go down to 20c (and not a wavy one).

Question: do you sell all the cans you have and then wait for the price to crash so you can buy back in? No. You eat them (sell) when you need to and you stack more whenever you are passing the LCS (local can shop).

Question 2: does Harvey Dent say you should buy silver when it drops below $10? I don't think so... he would just keep stacking them bonds.

 

I agree - PMs FTW *if you can hold 'em - zurnaik made the same point. But how many SSers will sell on the way or at bottom cause they have to or perceive they have to? The guy has a little bit of prediction history which should not be completely discounted. So saying "He's dented" is a little too easy I think.

 

It's only boom and bust for the 95% of people who allow complete strangers to manage their money for them. The other 5% take an interest in their own finances and don't use mainstream media as their financial advisor and manage to make modest gains every year with not too much risk.
The banksters suffered no bust in 2007-8, their pay and bonuses have exploded in the last 3 years. The regular punters (myself at the time), lost 30% in their super within weeks. The GFC was the reason i got myself educated on how the finance industry and stock markets REALLY work, and the games they play.

 

Your right on the money, i think Dent just doesn't understand this. If everything is collapsing but ratio's are quite important. The nominal value of something may drop but it may hold a greater purchasing power than it did at its old highs. I'm a little supprised he doesn't point that out.

 

Pure chartists ignore geo-politics, pure big picture investers ignore charts... he's neither

 

But those with savings and cash would be the real winners. Can YOU see that happening? Not this black duck. With that said. I am keeping some powder dry.

 

A lot of miners will sell at less than half the extraction price because in most mines, silver is a by-product that needs to be gotten rid of. Selling it for anything is a bonus so even if silver went to $1 oz - you would still see probably 70% of the current silver production being sold. This of course assumes that the main thing they are mining for is still worthwhile.

This is one of the reasons you see wild swings in price. When large movements are driven by "investment" as we have just seen - the majority users (industrial) just wait until the investors go quiet knowing that the price will come back when the froth and bubble dies down. Real sustainable increases in demand (and therefore price) only occur when the industrial users increase their purchasing.

malachii

 

I wonder what the AUD would be worth in this scenario - maybe about 30 cents USD?

 

A brand new world currency with some sort of a percentage connection to gold will mean that gold bugs will ultimately be rewarded imho.

I'd also expect Bretton Woods on steroids, worldwide turmoil such as last seen in Weimar Germany, and all this applying to mainly the Western World, with the BRICS saying 'and things seemed to be going so well' before they readjust their expectations of a standard of living and an airconditioner in every home.

As for the West - well Dent may be right, and I certainly hope he's not, but if he is I'd still rather hold onto gold rather than printed paper.

My main worry is what the USA giant will do as it thrashes around in its death throes. It could crush a lot of countries, Oz included.

I actually think that China and Europe are the union to watch:

http://www.google.com/hostednews/af...ocId=CNG.6e80a402d4f7614c65257c23ec625a13.911

A Euro China pact could quarantine a bit of damage and save quite a few banksters from lamp posts