Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Peloton 35% CRASH a Lesson of What Happens When One Over Pays for a Loss Making Growth Stock - 1st Dec 21
Stock Market Sentiment Speaks: I Fear For Retirees For The Next 20 Years - 1st Dec 21 t
Will the Anointed Finanical Experts Get It Wrong Again? - 1st Dec 21
Main Differences Between the UK and Canadian Gaming Markets - 1st Dec 21
Bitcoin Price TRIGGER for Accumulating Into Alt Coins for 2022 Price Explosion - 30th Nov 21
Omicron Covid Wave 4 Impact on Financial Markets - 30th Nov 21
Can You Hear It? That’s the Crowd Booing Gold’s Downturn - 30th Nov 21
Economic and Market Impacts of Omicron Strain Covid 4th Wave - 30th Nov 21
Stock Market Historical Trends Suggest A Strengthening Bullish Trend In December - 30th Nov 21
Crypto Market Analysis: What Trading Will Look Like in 2022 for Novice and Veteran Traders? - 30th Nov 21
Best Stocks for Investing to Profit form the Metaverse and Get Rich - 29th Nov 21
Should You Invest In Real Estate In 2021? - 29th Nov 21
Silver Long-term Trend Analysis - 28th Nov 21
Silver Mining Stocks Fundamentals - 28th Nov 21
Crude Oil Didn’t Like Thanksgiving Turkey This Year - 28th Nov 21
Sheffield First Snow Winter 2021 - Snowballs and Snowmen Fun - 28th Nov 21
Stock Market Investing LESSON - Buying Value - 27th Nov 21
Corsair MP600 NVME M.2 SSD 66% Performance Loss After 6 Months of Use - Benchmark Tests - 27th Nov 21
Stock Maket Trading Lesson - How to REALLY Trade Markets - 26th Nov 21
SILVER Price Trend Analysis - 26th Nov 21
Federal Reserve Asks Americans to Eat Soy “Meat” for Thanksgiving - 26th Nov 21
Is the S&P 500 Topping or Just Consolidating? - 26th Nov 21
Is a Bigger Drop in Gold Price Just Around the Corner? - 26th Nov 21
Financial Stocks ETF Sector XLF Pullback Sets Up A New $43.60 Upside Target - 26th Nov 21
A Couple of Things to Think About Before Buying Shares - 25th Nov 21
UK Best Fixed Rate Tariff Deal is to NOT FIX Gas and Electric Energy Tariffs During Winter 2021-22 - 25th Nov 21
Stock Market Begins it's Year End Seasonal Santa Rally - 24th Nov 21
How Silver Can Conquer $50+ in 2022 - 24th Nov 21
Stock Market Betting on Hawkish Fed - 24th Nov 21
Stock Market Elliott Wave Trend Forecast - 24th Nov 21
Your once-a-year All-Access Financial Markets Analysis Pass - 24th Nov 21
Did Zillow’s $300 million flop prove me wrong? - 24th Nov 21
Now Malaysian Drivers Renew Their Kurnia Car Insurance Online With Fincrew.my - 24th Nov 21
Gold / Silver Ratio - 23rd Nov 21
Stock Market Sentiment Speaks: Can We Get To 5500SPX In 2022? But 4440SPX Comes First - 23rd Nov 21
A Month-to-month breakdown of how Much Money Individuals are Spending on Stocks - 23rd Nov 21
S&P 500: Rallying Tech Stocks vs. Plummeting Oil Stocks - 23rd Nov 21
Like the Latest Bond Flick, the US Dollar Has No Time to Die - 23rd Nov 21
Why BITCOIN NEW ALL TIME HIGH Changes EVERYTHING! - 22nd Nov 21
Cannabis ETF MJ Basing & Volatility Patterns - 22nd Nov 21
The Most Important Lesson Learned from this COVID Pandemic - 22nd Nov 21
Dow Stock Market Trend Analysis - 22nd Nov 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Historical Inevitability and Gold and Silver Ownership

Commodities / Gold and Silver 2017 Aug 19, 2017 - 01:48 PM GMT

By: Michael_J_Kosares

Commodities

The Wall Street Journal’s editorial writer, Daniel Henninger, registers some very important observations in the wake of the troubling events in Charlottesville. Charlottesville, he attempts to point out, is symptomatic of something much deeper ingrained in the American psyche. “Some may say,” writes Henninger, “the Charlottesville riot was the lunatic fringe of the right and left, with no particular relevance to what falls in between. But I think Charlottesville may be a prototype of a politics that is drifting away from traditional norms of behavior and purpose.”  Aptly, the editorial is titled, “The Politics of Pointlessness.”


Any thoughtful individual who has witnessed the chaos in Washington would say that something has gone fundamentally wrong with our system of governance and it began way before Donald Trump entered the White House.  Through all of this I keep coming back to the seminal book published in 1997 by William Strauss and Neil Howe titled The Fourth Turning.  In that book the authors predicted much of what has happened in America over the past twenty years.

Fourth turnings are a time of crisis that can last 20-23 years

The fourth turning is a time of crisis – an overturning of the existing social and economic order. The start date of the current fourth turning, according to Neil Howe, is 2008.  Since turnings typically last 20-23 years, it will end sometime between 2028 and 2031.  So a lot of water will run under the bridge before it’s all over.

I listened to a compelling, recent interview of Neil Howe at the MacroVoices website – a thorough review of the ideas in the book and a lengthy look at what might be next. (The full interview transcript is linked below.)  To elaborate on my short description immediately above, here is Mr. Howe’s own description  of a fourth turning along with a few other important quotes from that interview:

 –– “The fourth turning is the final season of history, if you will, the final generation. And that is the period of crisis. That is the period when we tear down institutions that we’ve built, everything that’s dysfunctional. And we sort of rebuild things from scratch again. And it usually follows a period where—it’s bound up in a period where there’s complete disgust, complete distrust with what we have.”

–– “And I would say these are strong parallels that we see between the decade we’ve been living through and the 1930s. Because it isn’t just what happens to/in the economy. I mean, you consider so many ways in which this last decade has recapitulated the 1930s, starting off with a financial crisis, worries about deflation, worries about declining fertility rates, and currency wars, and beggar thy neighbor policies, and radical attempts by monetary and ultimately fiscal policy to remedy the situation.”

–– “I think we can be too mesmerized by the fact that the last fourth turning we had started with the Great Depression and ended with World War II. I think there are more possibilities. We could be defeated on a fourth turning. We could completely unravel on a fourth turning, giving the amazing popularity of these dystopian or alternative history drama shows on HBO and Netflix today really spelling out those scenarios.”

–– “And then the crisis, when all of these problems begin to coalesce into one huge problem. It’s when the Great Recession met all of these—the rise of fascism both in Asia and in Europe, and everything came together, currency wars, everything became part of a huge problem. Which, by the resolution, you see—and this is what happens at every fourth turning. All the little problems come together into a giant problem. And the giant problem gets completely solved.”

–– “So in politics we see volatility is incredibly high. If there were a political index—there is a political index, there’s a political uncertainty index which actually you can go on FRED and look at it, which is amazingly high levels compared to where it was for the last 20 or 30 years. There is a political index, but it’s very high right now as opposed to the market index which is very low. So, if you’re doing valuation divided by some measure of volatility, which is kind of your basic complacency index, that’s at record high levels now in markets. But you’d have to say complacency is at record low levels in our political and civic life. We’re totally nervous. We even, I think, to some extent, fear that we’ve lost any kind of public square, the ability to even have a public discourse on every issue. I think that that is a real problem.

[End quotes]

Historical inevitability and portfolio preparation: Gold and silver ownership

There is a certain amount of inevitability in Howe’s analysis that a good many will have a hard time accepting, but I am among the group that believes that we are carried on great waves of history whether we like or not.  That is why cycle theory has always appealed to me since my early days in the investment business.  I chose to become a gold and silver broker (back in 1973) because I have always believed that there are good and bad times economically, and when the bad times roll around, that is when you want to be sure that you have made preparation, and most advisedly well ahead of the trouble. Markets cycle.  Politics cycles.  Economies cycle.  Nature, by the way, cycles.  And when you really put on your thinking cap, that tells you why everything else cycles.

Gold and silver, unequivocally, remain the best choice to preserve capital during the secular downslopes – in times like these.  Whenever you watch what’s going on out there and you can’t seem to figure out why people are behaving the way they are, just remember that we are in the grips of a fourth turning and this is the way it is going to go and, as Howe points, it could get considerably worse.


If you have an abiding interest in the kind of analysis you are now reading, you might appreciate our monthly newsletter compiled and written by Michael J. Kosares, the author of the popular investor guideline,  The ABCs of Gold Investing: How to Protect and Build Your Wealth with Gold (Third Edition).  You can sign-up for it here.  Always timely.  Written for gold and silver owners or for those thinking about it.  Your interest is welcome.


My concern is getting across the bridge between the great crisis that may still be ahead of us and the resolution that comes at the end of fourth turning.  That is why I own gold personally and why I think every thinking, well-established individual financially should own it as well.  The name of the game is to protect wealth and not leave your life work on the table when the crisis hits with full force.  A diversification of about 10%-30%, in my view, will get the job done. How high you go within that range depends upon on how strongly you feel about what is going on.

Why I put so much stock in the book, The Fourth Turning

You may wonder why I put so much stock in Strauss and Howe’s The Fourth Turning.  Besides making a great deal of sense as a view of how we as human beings move through history from one generation to the next, the authors presciently predicted the 2008 financial crisis eleven years before it happened.

From The Fourth Turning:

“The next Fourth Turning is due to begin shortly after the new millennium, midway through the Oh-Oh decade. Around the year 2005, a sudden spark will catalyze a Crisis mood. Remnants of the old social order will disintegrate. Political and economic trust will implode. Real hardship will beset the land, with severe distress that could involve questions of class, race, nation, and empire.”

Talk about hitting the nail on the head.  The last two sentences tell it all as we now live through the experience.  I have always said that the gold and silver owner can afford to sit back and watch the show with a certain amount of detachment and comfort knowing you have done your best to protect your assets.  Gold certainly worked for its owners during the first stage of the fourth turning when gold went from roughly $700 per ounce to nearly $2000 at its peak before working back to current price levels. Silver did equally well going from roughly $16.50 to over $50 at its peak.

They are likely to work in the next stage of the cycle as well.  As we watch the social, economic and political implosion unfolding around us, you begin to wonder whether or not it has come time for the great middle of America to kick back a bit and take a more detached approach to the problems, and that is what Daniel Henninger is driving at in his editorial.

Neil Howe in his interview mentions a “political uncertainty” chart available at FRED in the quote section above.  I think he may have been talking about this chart, but even if it isn’t, it tells the same story.  As you can see, economic uncertainty has been running at a high level since the year 2000 and in direct correlation to gold’s secular bull market. Since 2008, for good reasons, the uncertainty has been running at consistently high levels and on a hair trigger. The current lull might simply be the calm before the next storm which, in my opinion, is already visible on the horizon.

I will end by returning to Daniel Henninger’s thoughtful editorial this morning and recommend that you read it in full along with Neil Howe’s interview.  Howe’s interview transcript and Henninger’s editorial are both linked immediately below.  Unfortunately, Henninger’s full article is not published in the clear, but Fox posted the beginning with a link to the full article.  Here is the thought with which he ends the piece.  It’s a good one.

“Amid the torrent, an odd paradox emerges:  People are consuming more content and detail about politics than ever, and more people than ever are saying, ‘I have no idea what is going on.’ Someone is at fault here, and it is not the absorbers of the information.  Charlottesville is being pounded into the national psyche this week as paroxysm of white nationalism.  On current course, the flight from politics is going to look like rational behavior.”

By Michael J. Kosares
Michael J. Kosares , founder and president
USAGOLD - Centennial Precious Metals, Denver

Michael J. Kosares is the founder of USAGOLD and the author of "The ABCs of Gold Investing - How To Protect and Build Your Wealth With Gold." He has over forty years experience in the physical gold business.  He is also the editor of Review & Outlook, the firm's newsletter which is offered free of charge and specializes in issues and opinion of importance to owners of gold coins and bullion.  If you would like to register for an e-mail alert when the next issue is published, please visit this link

Disclaimer: Opinions expressed in commentary e do not constitute an offer to buy or sell, or the solicitation of an offer to buy or sell any precious metals product, nor should they be viewed in any way as investment advice or advice to buy, sell or hold. Centennial Precious Metals, Inc. recommends the purchase of physical precious metals for asset preservation purposes, not speculation. Utilization of these opinions for speculative purposes is neither suggested nor advised. Commentary is strictly for educational purposes, and as such USAGOLD - Centennial Precious Metals does not warrant or guarantee the accuracy, timeliness or completeness of the information found here.

Michael J. Kosares Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in