Founder of the Trends Research Institute and Globalnomic® Trend Forecaster Gerald Celente returns with the economic forecast for the new year. $1,200 is the floor for gold - once the bulls push the price over $1,450 the sea change in sentiment could ignite an ascent to a new all time record over $2,000. Topping the list of catalysts expected to spark the chain reaction in the PMs sector include a spike in the crude oil price stemming from war in the Persian Gulf or the Ukraine. 2019 could see an economic 9/11 part II, not from the closely watched trade war between the two global economic-superpowers, but instead from the risk of higher rates. To keep the domestic economy from overheating the US Fed is currently slated to ratchet up the overnight lending rate another quarter point at the Dec 18th-19th FOMC meeting and hike again 3-4 times in 2019. Although domestic home prices remain mostly firm, higher rates have put pressure on new home sales making housing less affordable amid climbing mortgage rates. Higher rates translates into "The end of cheap money," for borrowers and corporations, many of whom bought back billions of dollars of their own shares, such as GE that recently plunged from over $30 to $6 as the longest remaining Dow company, the hallmark of US Corporate America, General Electric, GE is struggling to remain solvent. However, although GE could be ejected from the Dow 30, just a year ago the former Blue Chip was a high flyer (figure 1.1. & 1.2.). Nonetheless, out guest questions how long rates will remain elevated - global central banks could be forced to abruptly drop rates in similar fashion as 2008-2009 as stock markets continue to erase several years of shares gains. While Gerald Celente notes the economic data suggests shares are overpriced, Stansburry Research is predicting a "Melt up" in US shares, where the Dow doubles to 50,000 and perhaps much further, mirroring the sentiments of The Forecaster, Martin Armstrong.
Figure 1.1. GE Share Price Near Record 1 Year Earlier
Figure 1.2. GE Share Price Plunge
Note. Chart provided via written permission from Stockcharts.com.
Figure 1.3. Positive Life Strategies: Joe Rogan Experience #1208 - Jordan Peterson (Explicit Language, 21+)
Note. Video provided courtesy of Youtube.com.
Figure 1.4. Brilliant Insights on A.I., Cryptos and Futurism: Joe Rogan Experience #1211 - Dr. Ben Goertzel (Explicit Language, 21+)
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