DOW Dropped 1000 Points, Is It Time To Exit?

By Peter Costa

It is staggering how so many individuals use the stock market as a gauge for economic recovery. They look blindly at the levels of the S&P 500 and the DOW Jones in hopes of finding the answer to where we are in the recovery stage. Whether the stock market is up or down, these simpletons continue to foolishly dump their hard earned wages into the market place. They are incognizant to the reality of our financial system and have no interest in learning the truth.

The world stared in awe as the DOW dropped 1000 points within a 15 minute time span on May.6, 2010. This was the largest drop the DOW has ever had in a single day since its inception. As the DOW scrambled to recover rumors began to surface that the event was triggered by a negligent trader. Apparently he meant to type $10 million for a trade and instead typed $10 billion. Thanks to our experts and market analyst being on the ball we learned that the fatal drop of the DOW had to do with the letter “b”. Simple mistake that anyone can make and now that we have it all figured out the DOW will go back to record highs. Who are we kidding? How “birdbrain” does one have to be to believe this rhetoric? There is no way that the DOW took such a precipitous drop due to $10 billion. This is a sign to all that are still in the market place to GET OUT.

I strongly believe that the stock market is just as illusionary as our monetary system. I feel like so many have become accustomed to using the stock market as a gauge for economic recovery that those in charge have an interest in keeping it up. The greenback is on such volatile ground right now that any loss of consumer confidence could bring down a collapse of the whole system. I’m coming to believe that most of the money being printed up right now is being used to prop up the stock market to give it illusionary growth. Companies are continuing to be bailed out and funneled more money so that the stock market can show some sort of recovery. It seems like Wall Street has become more important than the citizens of the United States. While citizens are being handed out food rations and barely surviving, Wall Street is being handed billions of dollars to keep the stock market propped up. Unfortunately the reality is that more people are exiting the stock market than entering and this is the reason the DOW took such a tumble on May.6, 2010. Further more for almost 3 years now the smart money has quietly exited the marketplace leaving nothing but the uninstructed to fend for themselves.

I am calling for a complete crash in the stock market within the next 2-5 years. Based on copious research I have come to conclude that there is no possible way for the stock market to survive in the coming times. There are 3 major factors guaranteeing the demise of the stock market and they are as follows:

HYPER INFLATION:

There is no doubt that hyper inflation is about to rear its ugly head in the United States. Ben Bernanke has stated on several occasions that he would rather create inflation than deflation. He has kept interest rates extremely low to guarantee this and has no interest in the immediate future of changing things. The economy has hit such a breaking point in the US where the printing press at the Federal Reserve is churning out strenuous amounts of money. The amount of money being printed right now is unprecedented from anytime in the nation’s history and the demand is only growing. We are projected to spend trillions of dollars in the coming years guaranteeing the devaluation of the greenback. The banking crisis alone is projected to cost the US $23.7 trillion to solve. This number does not even include social security, outstanding treasury bills to foreign nations or the toxic mortgage debt that continues to grow among many other things. As the dollar continues to be printed it will encounter precipitous devaluation. As the dollar crashes investors will jump ship from the stock market scrambling to put whatever they can into tangible assets such as gold and silver.

UNEMPLOYMENT:

Unemployment is at record highs and has no sign of recovery. The problem that lies ahead is the amount of people getting cut off of unemployment insurance. For the first time in decades they recently had to extend unemployment insurance for all recipients. This solution was temporary and in 2010 millions will be cut off of assistance. Here is where things get sticky. With most people unable to find employment they are now being forced to cash out of their retirement plans. As millions of IRAs and 401(K)s are cashed out, billions of dollars are being pulled out of the market place. The majority of retirement plans in the US are invested heavily in the stock market with over 90% in mutual funds and various stocks. As these are cashed in and the money is pulled out of the market place we are guaranteed to see a drop in the stock market. If things continue the way they are going in 3 short years we could see billions upon billions of dollars pulled out of the stock market in an attempt for unemployed people to survive. If $10 billion was really the reason the DOW dropped 1000 points in a day imagine what this will do.

LOSS OF CONFIDENCE:

With the stock market on such volatile ground it has caused a ton of uncertainty in the market place. Since the drop of the DOW on May.6, 2010 hundreds of thousands of investor have begun to quietly pull their money out of the stock market. Many have interpreted the drop of the DOW as a fore warning to get out of the market and have begun to act accordingly. In less than 2 weeks of this event millions of dollars have already been pulled out of the market place. We have already lost confidence from some of the largest investors in the world including Warren Buffet, John Paulson, David Einhorn and George Sorros who have begun pouring their wealth into commodities. Warren Buffet who has made billions investing in US stocks is now turning his strategy over into precious metals and recently made a substantial investment in silver. John Paulson owner of Paulson and Co. who runs a $60 billion hedge fund has positioned over 50% of its assets in gold or gold related investments and opened up a gold only hedge fund this year with $250 million of his own money. This is a sign of the times and will only increase as things take a turn for the worst.

If you are currently in the stock market heed my warning about the coming collapse. It is not by chance that the DOW took such an enormous drop; it is truly a sign of the times to come. For almost 3 years now all of the smart money have been quietly exiting the market place and changing their strategies into hedges. It is not by chance that most successful investors in the world right now are hedge fund managers. This is a time of hedging not investing. When the dollar is strong and showing a lot of possibility that is when you want to double it and make investments. When the dollar is dropping like a rock in value and being printed like monopoly money you want to hedge against it. Take a look around the world and see the change in the market place this is not a time for investments it is a time for hedges. If you have not properly hedged yourself now is the time to take action. When everything takes a turn for the worst it will happen suddenly and without warning. As we all saw on May.6, 2010 the DOW dropped 1000 points in 15 minutes without warning. You have worked hard your entire life do not let the wealth you have accumulated go down the drain. Physical possession of precious metals such as gold and silver are the easiest way to begin hedging. If you need help in doing this please visit www.regalgoldcoins.com and get started right away. Regal Assets is one of the most trusted names in the precious metals industry and has some of the best prices when it comes to precious metals. Take this action before you are left with paper that has been stripped of all its monetary value.

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