Just. Got. Real. – Egon von Greyerz Says Ride The Precious Metals Tide Or End Up In Financial Misery

Friday, September 28, 2018
By Paul Martin

September 28, 2018

Egon says we’re at a crossroads, where investors will either “lose it all” or benefit from the “biggest wealth transfer in history”. Here are the details…

by Egon von Greyerz of Gold Switzerland

With global investment markets standing at crossroads, investors have the option to lose it all or to benefit from the biggest wealth transfer in history. I have quoted this passage from Shakespeare’s Julius Caesar many times but it is more appropriate than ever for the situation the world is now in:

“There is a tide in the affairs of men
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or lose our ventures.”

William Shakespeare

Sadly, very few will take the correct current and that is why the majority of people will end in shallows and miseries. The wealthy will lose the majority of their fortunes and many of the poor be exposed to poverty and famine. I know this sounds like another prophecy of doom and gloom but we don’t need to go further than Venezuela, with inflation reaching 1 million percent and the currency collapsing by 99.9% this year to understand what can happen. A cup of coffee costs 2 million Bolivars and most Venezuelans can neither get hold of nor afford sufficient food for their family. A major part of the adult population has lost 25 pounds (11kg) in weight.


In most countries in the West, it is still not too late to prepare a wealth preservation plan. People who have savings and investments have a lot more to lose relatively than the poor but for the less well off it will be a matter of survival just like for the Venezuelans.

There are many survival guides as regards all aspects of life. Jim Sinclair has for example written an excellent “Be Prepared” series that covers many of these aspects.

Probably less than 1% of investors will take the tide which “leads to fortune”. What most people won’t understand is that the Central Bank credit expansion bonanza is now coming to an end. The exponential moves up in stocks, bonds and property prices, will turn to catastrophic falls that will destroy most of the wealth in the world.

In the next 3-7 years, it is not going to be a question of making a fortune but to lose as little as possible.

So let’s look at the major risks and the best financial protection.


The bubble assets will of course be the most vulnerable. If we start with the Nasdaq, it is up by over 700% since 2009, driven by the FAANG stocks (Facebook, Apple, Amazon, Netflix, Google ). So since the 2009 bottom, a $10,000 investment in 2009 would today be worth $70,000 by just buying the index, a 24% annual growth rate.

The Dow and S&P indices have gone up slightly less but are still at all time highs due to the massive liquidity created by central banks since the 2007-9 crisis.

At the same time as most stock markets are greatly overvalued there are markets that are severely undervalued and ignored by most investors.

Commodities are at historical lows against stocks and due for a substantial revaluation. As the chart above shows, stocks are today in a historical bubble and at a 50 year high against commodities. The moves down in stocks and up in commodities will be massive. It is a virtual certainty that the ratio will go back to the 1990 level which would mean a 90% fall of stocks against commodities.


Although we are going to see commodities outperforming all asset markets, it will be critical to pick the right ones. Gold, Silver, Platinum and Precious Metal Stocks are of course the obvious choice. Not only is the precious metal complex extremely oversold against all the bubble assets but it is also the ultimate wealth preservation asset.

The Rest…HERE

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