With commodities up, I'm in the mood for some more bearish talk. If the current loses continue, Nenner may have accurately predicted a top at 12,300 for the Dow-- back in November, which I believe was when these interviews were shot. Are we now spiraling down towards 5,000: that is the question.

Nenner is one of the odder characters around--although he did spend 12 years at Goldman, probably gouging investors.  One of his methods of forecasting is using the sun's patterns.

He makes interesting points in his arguments that we are actually in a deflationary period. Although we are heavily printing paper currency, real wages are not rising—don’t forget to add in unemployment and municipalities flirting with defaults. Banks have also also cut domestic lending.The only logical explanation for this would be gridlock in the flow of capital (deflation).

Money printing through bailouts is never an ideal scenario, but whats really preventing the US from getting any of the side benefits of inflation is the misallocation of funds-- which is precisely what’s going on. Bernanke is focused on bailing out the financial industry and a few other fortune 500 firms. However, mortgages remain underwater and productive industries have not been spurred on.  If he would have attacked the issues directly instead of pandering to the banking sector, we would have seen a turnaround in the economy.

Trickle down has been debunked. Yes, the liquidity is in the hands of the top 2-3 percent of the population, major investors, speculators and banks are moving paper currency around the world into emerging markets and commodities, but this is proving to be dysfunctional over long periods, especially for Americans.

And this is ties in exactly to where I would disagree with Nenner-- his bullish outlook on bonds and to a lesser extent, gold topping out at 2,500. I see bonds and as a terrible investment, especially as a safe haven through the economic downturn. I'd reweight the argument in favor of commodities and to a lesser degree, the emerging markets.


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