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October 26, 2005

The Crash!
by Magnus Ekervik

In 2005 stock markets, bond markets, commodities and precious metals have all lined up to create the perfect setup for a devastating crash.

With the help of hedge funds, index funds, Wall Street bankers, derivatives, central banks, the average speculator/investor (the herd) and the house market bubble the monetary system have been stretched beyond all historical comparison and is now showing signs of severe distress.

We have passed the point of return, the crash will come the only question now is how deep and severe it will be. All my analysis tells me it will be worse than both 1929 and 1987.

I have warned of an approaching crash for 18 months. Since consumer sentiment has collapsed lately I now believe the crash and panic is very close and will hit before this year ends. The only thing missing now is the trigger that accelerates the crash. For possible triggers see my earlier article Instant Economic Depression.

The best place to park your money to avoid the crash is in cash.

This will be my last bearish article for a long time. Next time I write will be after the crash in the middle of fear and panic. That article will be bullish and discuss what type of financial assets to buy in the new economic depression...

Magnus Ekervik

Magnus Ekervik offers independent research and analysis of macroeconomics to financial corporations and financial newspapers. For more information please contact: ekervik@gmail.com