MASSIVE DEFLATION AHEAD!!!!!

Last night I just finished reading Robert Prechter's book "Conquer the Crash" in which he makes a brilliant case for the fact that severe deflation is not only likely, but also long overdue. The phony wealth that the American economy has experienced over the last 3 decades has been generated by a record of amount of credit expansion. We really have't seen legitimate deflation since the 1930's when we were in the midst of the Great Depression. The policy makers at the central bank believe they can pull the right levers and steer this economy out of recession but they can't. What is looming is a massive amount of debt deflation. There are too many bad outstanding debts right now, and they are about to be liquidated.

If you thought 2008 was bad, you haven't seen anything yet. We are about to experience the biggest stock market crash in the history of the world. Don't believe me? No one believed similar warnings in 1929, and no one believed the dot-com bubble would come crashing down either, but it did. Social sentiment is exactly where it should be prior to an epic collapse. Most people listen to the state controlled main stream media. Unfortunately, most people still trust their government. The government is wrong. There is no recovery! We are going into a depression and it is going to be bigger than the 1930's! It is going to have the psychological effect of changing an entire generation's perception towards the concepts of debt and saving just like the Great depression did. The utterly corrupt U.S. financial system is about to be purged of all it's excessive greed and manipulation, and everyone is going got get a clear look at how fradulent our economic system has become.

My best advice to anyone who is still asleep to what's going on is to get your money into treasuries or cash equivalents as quickly as you can. Policians and people within the msm and financial news media make a living out of propogating lies, but the market does not lie. The capital markets are deteriorating right before our very eyes. All the major indeces have moved below their repspective 200-day moving averages. The economic indicators and underlying fundamenals are the weakest they have been in 30 years. If you want to profit from this collapse, I suggest shorting the market. Ticker symbols DOG, QQQQ, VXX, SEF, SKF, FAZ, are good places to start. If you are too risk averse to place downside bets, then hold cash or go long the dollar in the currency markets.

99% of people are about to suffer severe economic pain and you don't have to be one of them...

Until next time,

-Phil