Fear and greed.
The two eternal forces moving every market, bull or bear.
The transitions are rarely instant. Instead, they occur over time as investor sentiment slowly shifts.
It is in these transition periods that the market ranges sideways, as fear and greed battle for supremacy.
Such were the periods from 1999 to 2000 and from 2006 to 2007.
And such is the period we are in right now… a period that began in 2018.
And what inevitably follows such a period is a market crash.
Will the market decline by 30%… 50%… more?
That is anyone’s guess at this point. However, I can tell you with certainty that decline this market will.
Many Signals, One Message
The many yield curve inversions of the past year have sent warnings of a possible recession. Until now, though, it has been possible to debate them.
The 3-month /10-year inversion yield curve has been inverted for three months.
Whenever that has happened in history, a recession has followed.
There’s no debating this signal. It’s 100% accurate.
Add to this reality the fact that there is now no chance the United States will sign a trade deal with China anytime soon and you have a recipe for disaster.
The top three economies in the world—the United States, China, and the EU with its Brexit fiasco—are all experiencing a decline. Hardly a bullish climate for the stock market.
Other indicators are telling the same story.
Cyclical stock indexes from the S&P 500 are almost back in bear market territory, as are base metals. Moreover, you have several of the largest economies in the world, including Germany, the U.K., and Brazil, expected to slide into a recession by the end of September.
Last Chance To Act
I know I sound like a broken record, but I want to be sure you get this message:
Start buying gold now.
It’s going to appreciate in value considerably over the next two years. In fact, this trend has already started. The price of the metal has increased by $325 in the last year, and I believe it will break above $2,000 per ounce by the end of 2020.
I’m increasing my gold position, though I already hold a significant amount.
And don’t think you must buy bullion to profit from the appreciation to come. Hardly anyone plays gold that way anymore.
Instead, I recommend buying stocks of gold mining companies. Their revenues and earnings will increase dramatically as the price of the precious metal grows.
During and after the last recession, the price of gold increased by about 150%. Gold mining stocks appreciated even more.
GDX, the most popular ETF tracking gold miners, gained nearly 300% during the same period. Almost double the price increase of gold.
And some specific mining stocks appreciated even more.
In this month’s True Retirement Wealth issue I share details of two such stocks that I believe will outrun the market.
Since last Tuesday when I recommended them to my subscribers, they’re already up by 8.36% and 9.81%, respectively.
As I explain in the issue, I believe that’s only the beginning.
You can find more here.