Rickards Raises Hurricane Flag
Moans reader Michael R.:
“What’s the point of reading these lengthy remarks about the demise of our economy? All I’m seeking is specific stock tips.”
A fish prowls the depths in pursuit of lunch. It seeks its own “stock tips” to guide the hunt.
It lacks all curiosity of the greater ocean through which it slithers.
Yet we hazard our readers are not simply fish hunting lunch. We hazard they harbor a greater appetite.
An appetite — that is — for a greater understanding of the oceanic realm they inhabit.
They seek to understand the deeper currents that push them here and pull them there.
They seek to understand the formation of tempests that frenzy them.
They seek to understand “the big picture.”
To which compass point are interest rates drifting? Is the economy sailing into biting recessionary gales?
Are financial typhoons taking form?
We seek answers to these questions — and we believe you do too.
Neptune Is a Capricious and Inscrutable God
Thus we take our barometric readings. Thus we float our weather balloons. Thus we consult our weather stations.
What comes of it all? We often botch the forecast.
We are an oceanographer who is — if you’ll forgive the expression — “at sea.”
Yet Neptune is a capricious and inscrutable god. His will is not easily divined.
Should we abandon the quest altogether?
We do not believe we should.
We may place you on hurricane watch. By our own admission, the storm may never blow ashore.
Yet what if it does? What if it battens you… rubbles your house… even murders you?
Is it not better to prepare — just in case — even if the tempest tacks to sea?
Is not the preventive ounce worth its curative pound?
The ounce is light. The pound is heavy.
Jim Rickards Issues a Hurricane Watch
Just last evening Jim Rickards issued his own hurricane watch.
Jim telegraphed a warning that the barometric pressure is plunging… the sea is churning… and that within weeks perhaps… another Lehman-like hurricane may barrel ashore:
This senior member of Congress failed to heed Jim’s advisory. Few, in fact, did.
Yet three weeks later the storm blew in and blew Lehman down.
Thus commenced the “Great Financial Crisis.”
When precisely does Jim expect landfall?
The Ounce of Prevention and the Pound of Cure
Will Jim’s grim forecast prove accurate? Or is he raising a false storm flag?
Or is landfall perhaps months distant — not days or weeks distant — as Jim projects?
We do not know. Each outcome is possible.
Yet we return to the advantages of preparation, to the ounce of prevention and its pound of cure.
You plywood your windows. You stow emergency provisions. You purchase a power generator.
And if the hurricane skirts you altogether? If the winds and rains never besiege you?
Your ounce of prevention has cost you comparatively little — some plywood, some foodstuffs, a generator.
The Prepared vs. the Unprepared
Yet what if the tempest actually comes in and waylays you?
Your ounce of prevention works its pound of cure. You are equipped.
Your windows can withstand the gales, you have abundant rations on hand, your lights are on.
You are the envy of your neighbors — your neighbors who failed to prepare.
They are wrecked, famished and powerless — literally and figuratively.
You are not.
What would they give for a second chance, a chance to step back in time… and purchase their ounce of prevention?
Very much we hazard.
Yet it is too late. The precious ounce is unavailable at any price.
Yet against the banking hurricane Jim forecasts… it is available… at an attractive price.
Will they prove necessary? Again, we do not know.
We do not know if landfall is next week, next month or never.
Yet they constitute prevention. And they may prove priceless.
“Sometimes Right, Sometimes Wrong… and Always in Doubt”
We can only issue our forecasts, secure in the knowledge we may make heavy weather of them.
Explains our co-founder, Mr. Bill Bonner:
And so here we sit: Sometimes right. Sometimes wrong…
Always in doubt.
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