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February 25, 2005

READER SURVEY RESPONSES: EXTENDED PREDICTIONS ’05 SUMMARIZED

I’ve been slow getting to this summary, so apologies for dragging this in to the second month of the year! However, I think it is worth the wait, the results below are informative. I’ve read through all of the posts and then categorized them in to primarily “yes” or “no” answers where possible. This was inexact, so don’t hang me if you feel my interpretation of some answers was incorrect, I did the best I could to make sense of answers and to drop them in to one category or another. When an answer was too difficult to interpret I just didn’t count it. Next up I’ll be working on my predictions for the next 12 months, but for now enjoy this summary of reader input, I’ve repeated the survey question, followed by the results and then some of my own comments:


1. How would you invest $100,000 in '05 to achieve the best gains?
Cash/CD’s 6
Precious Metals 10
Energy 3
Tech Stocks 4
Foreign Exchange 6
Land 4
Food 2
Stock Markets 7
Bonds 2

Comment: Seems that gold came out the winner in this race, which is not too surprising as we are a bunch of gold bugs on the www.Depression2.com site! No one seemed to think that ammunition was worth investing in, which I guess is a good thing – but some folks wanted food and land. In general people are harboring their wealth in metals, cash, foreign currencies and the stock market. I guess a good summation here would be to lean heavily on metals with some diversification out of dollar denominated financial assets.

2. Will planet earth be rocked by more record breaking "earth changes"
Yes 10
No 6

Comment: The majority here felt that we’d continue to experience the trend of the past couple of years where we’ve seen increasing global warming (whether as a result of the sun or mankind) and an up-tick in seismic activity, with more earthquakes and eruptions and resultant tsunami’s – perhaps with some more hurricanes, tornadoes and storms. A lot of folks felt these events couldn’t be predicted, some felt that what we’ve been experiencing lately was normal and wrote off the notion that this was much of an issue. Personally I believe this area is as big as war, financial crisis and other man-made disasters – it’s all one big boiling soup of potential upheaval!

3. Will humanity face an epidemic of some kind during the year that will cause massive loss of life?
Yes 9
No 6
Aids Already 2

Comment: I don’t know about where you live/work but there have been 2 large flu outbreaks at my workplace in the past 3 months and they were pretty nasty, of course this happens annually but it sure as heck seems like the incidence of outbreak has increased over the years. Globally there definitely appears to be an increase in animal epidemics and airborne viruses, etc. As a group we appear to be agreeing with that interpretation.

4. Will the US be struck by another terrorist attack on a scale greater than 9/11?
Yes 8
No 6

Comment: Some folks abstained from this as it was too unthinkable for them to think about. I must say that growing up in Britain during the IRA terrorist attacks we didn’t think about it because we knew it would happen again. To be honest we didn’t even worry about it much either, different times I guess. The attacks in Britain weren’t on the scale of 9/11 and weren’t on the same frequency of what the Israeli’s experience, but they were a constant threat and people just got on with their lives. It is now mid-February, so almost one sixth of the year has already passed us by. Earlier this week there were reports that there is a rising terror threat in the US, I’m expecting a Code Orange any day now, it’s been a while and the powers that be need to ensure the system is still working and still generating unnecessary fear in the masses.

5. Where will interest rates end the year, will the Fed raise them continually throughout '05?
<3% 3
>4% 13

Comment: This was easy; nearly all of us felt that rates would rise over the 4% mark during the year. This week Sir Greenspan has made noises that another increase is on the way – so we’re easily on target to exceed the 4% level by late summer. I guess the big question is whether something unexpected happens, like the Koreans pulling out of the US $$, or the revaluation of the Chinese Yuan, etc. that could really impact the current trend. All things being equal rates should rise for some considerable time.

6. If democratic elections go ahead in Iraq this year will a Shi-ite regime come to power?
Yes 9
No 5
US Puppet 5

Comment: Looks like a Shi-ite coalition with the Kurds and “moderate” Sunni’s is on its way in to power in Iraq. I find it massively ironic that we supported puppet Saddam against the radical Iranian Shi-ite’s for a decade because he was a secular Sunni. Now we’re supporting the supposedly secular Shi-ite’s against the now “fundamentalist” Sunni’s who are now known as insurgents! I know, it’s confusing – and we all know this president is easily confused. Just how a “democracy” is supposed to work in any current Middle Eastern country is beyond me, so the future of this issue will be interesting to watch. Kuwait, Sharjah, Dubai, Abu Dhabi (UAE) appear to be stable and somewhat democratically run principalities – freedom abounds for everyone, almost, in those small, massively oil rich countries. But therein lies the rub. Almost any nation on earth can be “moved” in to the western sphere of influence, and the western materialist lifestyle, if there is endless wealth and a tiny population! Unfortunately the large Muslim states have large populations and local wealth is for the ruling class only, so religion is the opium of the masses, which pits the more radical, Muslim poor against us western secularists. So, it’s really about economics at the end of the day, but that is not what the corporate-owned media want American’s to understand. We need these people as our enemies, so we can justify our actions – for economic reasons!

7. Does Hugo Chavez of Venezuela survive 2005?
Yes 14
No 5

Comment: I hope the majority of readers are right on this, the world needs a few outspoken voices of dissent. I don’t pretend to know Chavez’ politics – I hear he is a Commie! Frankly his politics don’t matter to me, he is the leader of a small inconsequential South American nation that is not a threat to anyone. Of course, they have oil – so that makes Venezuela “strategic” – which means we have the right to mess with him and the people there. Bottom line for me is that the Venezuelan people deserve to choose their own direction, even if it’s not ours! Now if they become a threat to our physical security then that may change my perspective, after all we have the right to defend ourselves, but last time I checked the Venezuelan navy, army and airforce could probably be defeated by one US Navy aircraft carrier! Lets leave Venezuela to the Venezuelan’s and see how they do!

8. Will Osama be caught some time during the year?
Yes 2
No 15

Comment: Intriguing result here. Seems we’re all a bunch of cynics who believe that OSB is really a construct of the Western money power, or somehow a puppet of the current US regime!? If that really is the case then do we collectively believe that 9/11 was also a fabrication? These are taboo questions in almost any other environment. I know what I believe; I’ve believed it since I saw the first plane hit the first tower. There is a criminal element within the US government that is complicit in these events – at the very least. When analyzing the history of the world it is best to do so from the perspective of “who benefits.” Major events in history are rarely purely accidental, life just isn’t like that. Cause and effect is at work in the world. To me 9/11 looks like another Gulf of Tonkin or Pearl Harbor incident – there is a body of evidence now that suggests that these events were instigated by the West to enable the prevailing geopolitical agenda to be fulfilled. This is very Hegelian in construct: Thesis, Synthesis, Antithesis – if you are unfamiliar with this Machiavellian approach to population manipulation then go Google “Hegelian Dialectic” and read up on just how events are engineered to produce specific outcomes in the minds eye of society in order to manage the consent of the masses (while you are at it look up “managed consent” and learn how the media is being used to shape how society reacts to anything of importance).

9. Does the US go to war against another adversary during '05, Iran, N. Korea, etc?
Yes 6
No 12

Comment: I think the majority here have it wrong (but I hope not), in the past few weeks it has looked more and more likely that the US is gearing up for phase II of the neo-conservative, global domination plan – also known as the New World Order. Most likely the next action with be some kind of an attack, or “accident,” on Iranian nuclear installations. Whether the Mullah’s (or Moolar’s as the president calls them) should ever be allowed to have nukes is probably a real good question for public debate. I would conjecture that the western public would vote overwhelmingly to block Iran from gaining nuclear weapons – the idea of some half-crazed religious zealot having his finger on the button is abhorrent to most of us, but of course Iran isn’t the only nation with religious zealots in control now is it!?

10. Does the Chinese bubble burst in '05?
Yes 8
No 10

Comment: Well the vote was pretty evenly split on this. Interestingly no one questioned whether the Chinese economy was a bubble, just commented on whether it would burst in ’05 or later. If it bursts soon then I hope you’ve all stocked up on those cheap Chinese imports, because the materialist, mass-consumption party will definitely be over if their economy catches pneumonia. There is a symbiotic relationship between China and the US, trash and trinkets for fiat dollars – it works and it’s energizing the world’s largest population and keeping us consuming westerns doped up on cheap stuff. But just how long the US can afford to consume Chinese exports, and just how many US dollars the Chinese are able to store for a rainy day, and whether the Chinese economy can be self-sustaining without the US market, are the big questions. If the music stops in ’05, who gets the last chair?

In conclusion, I hope readers have had a great time with this little experiment in predicting the outcome of 2005. I have a feeling the vast majority of answers are correct and that collectively you are seeing the future quite clearly. Stay tuned and we’ll track just how close these predictions are over the next 12 months.

Next up, I’ll be publishing how I see the rest of 2005.

Cheers Rich

Posted by richardlancaster at 12:24 AM | Comments (12)

SUMMARIZING 2004 PREDICTIONS

February 15, 2005

Summarizing 2004 Predictions - Rich Lancaster

Frederick Nietzsche once wrote that people "on the approach of severe pain, hear the very opposite call of command, and never appear more proud, more martial, or more happy than when the storm is brewing."

How prescient Mr. Nietzsche was! We contrarians marvel at this psychological quirk in humanity. Just how does Joe Consumer remain so defiant in the face of so much evidence of the coming financial storm? The collective subconscious is astonishing in its stoicism, fortitude, delusion and denial. Perhaps humans share certain inherent traits with the Lemming?

In 2004 I titled my predictions, The Lull Before the Storm, and I still believe that title is appropriate today. The storm is still forming just over the horizon, but society is blissful in its interpretation of events current and future.

However, without the necessary flushing of our debt-burdened system (like some kind of financial colonic) we are just stalling the required adjustment and increasing its ultimate impact by layering more debt on top of existing debt. I believe that the debt-based money system foisted on us by the international bankers through the Federal Reserve Act of 1913 is ultimately responsible for the predicament we’re in – and until that entire philosophical approach to monetary control, supply, fraud and manipulation is deconstructed we are really never going to be safe from financial thunder and monetary lightning strikes. But lets save the rest of that debate for another day.

Here is my analysis of how my 2004 Predictions performed:

1. Bush re-elected. For me this was a no-brainer. Once I discovered that Kerry was another (Skull &) Bonesman it was all over. The media did an amazing hatchet job on Howard Dean and the people just took it in the shorts and said/did nothing - - again. Of course the election was rigged with rampant fraud, especially in Ohio, but lets sweep all of that under the carpet. The American governmental system has devolved in to the status of a banana republic with a junta in control. Get used to it, and be grateful and thankful for the freedoms we still have – who knows how long we’ll have them?!

2. China revalues Yuan. Wrong! They didn’t, they should have but they didn’t. It seems inevitable to me that this happens, so I’ll mention this again in my 2005 Predictions.

3. Europe struggles. They did, but they also made large gains in terms of the Euro being seriously considered as a replacement for the Dollar. The EU is a net creditor with a new fiat currency, whereas the US is a net debtor with a tired old fiat currency. Seems to me that Petro-euro’s could really help improve the EU economy over time with net inflows in to EU countries/companies that are less debt burdened than their US counterparts, and more fairly valued.

4. US Dollar stabilizes around 80 through the election. Right on the money, so to speak. The dollar has traded just above 80 since the election; it was hovering around at 81 as the New Year broke. The dollar will continue to decline in my humble opinion – but that’s not rocket-science anymore as the mainstream media arrived at this conclusion in the third quarter of ‘04.

5. Consumer prices deflate somewhat. Well we have stagflation or disinflation or really some inflation and deflation concurrently. Basically goods that deflate do not show up in inflation figures, but for sure we’ve seen prices going down on all kinds of items from cars and appliances to electronics and goods coming from China. Oil, natural gas, stocks and housing have all been inflating.

6. Gold rises to $450 by year end. This was easy. Gold moves in the inverse to the USD, so if you pick one you just do the math for the other. The coupling of gold to the USD is a bit of a mystery to me, although of course I understand the store of value issue with gold all too well. I’m just not sure why the coupling and the inversion of the two remains so absolutely rock solid. I wonder if they may decouple at some point in 2005? Anyway, my gold trades didn’t exactly rock this year as the junior mining stocks performed badly, so even being right in the big picture hasn’t helped me a great deal financially.

7. Oil continues to move upwards ending the year at close to $40 per barrel. Well I didn’t imagine oil going to $55, or the debate about Peak Oil being pushed so far to the forefront. I think it is amazing to watch CEO’s of some of the largest companies in the world start to suggest that all is not well in Denmark (or should I say Saudi, Venezuela, Nigeria, Somalia, Iraq, Iran, most of the “Stans” etc?). Even the new TV ads from British Petroleum suggest that the company is now planning its future beyond oil extraction. Oil makes the world go round (or it that electro-magnetism? I don’t know!), along with money and gold!

8. Interest rates rise towards the end of the year, but not massively. This was easy. The Fed has accurately and consistently signaled their intentions with rates now for some time, and they really haven’t deviated at all from their course, yet. What is interesting in this space is watching the central banks of other western democracies (banana republics) – they ratcheted up rates earlier than the Fed and their economies, especially housing, are starting to show signs of stalling – I’m sure this trend will continue and catch up with the US shortly as rates continue to rise.

9. Real estate drops in value and slows by end of 2Q. Real estate is all about location, so I guess I’m part right, depending on where you are talking about. As mentioned above, in the UK housing has started to stall and quite noticeably, they are the proverbial canary in the coal mine when it comes to asset deflation as a result of increasing rates. I was wrong about US real estate, my timing was wrong

10. Whiffs of deflation by Q3. I’ve covered this above more or less, it’s a mixed bag, I’ve vacillated between believing in a hyperinflationary depression to a deflationary depression that then devolves in to a hyperinflationary depression - - I guess either way I believe in hyperinflation being the outcome, but deflation does seem pretty intuitive given the monetary roulette the Fed has played for so long. Sooner or later consumers will not longer be able to consume more debt, the merry-go-round will begin to slow and deflation will start to spiral out of control. Then I see the Fed opening the flood gates in a last ditch effort to stall complete collapse – which will precede the rolling out of a new global currency that will be introduced by the BIS, IMF, World Bank and the Fed - - with the very vocal and public support of JP Morgan Chase and Citigroup and the central banks of the world’s leading banana republics (like Britain, the EU, Australia, Canada, Russia, Japan, China & assorted other aligned countries).

11. The American population remains blissfully ignorant amidst the biggest meltdown of a global financial system in the history of this Universe. Bingo, the people are on the whole absolutely clueless – or worse, willingly & enthusiastically deluded. I must say though I do detect that people in general know that something is absolutely fundamentally wrong, but they are too distracted to follow through on their suspicions, and lets face it….life is just too good to mess around learning the truth or reality!

12. Upon the conclusion of the election we start to accelerate towards the inevitable collapse of our monetary system and all of the necessary, but very painful, adjustments in our lives that comes with it. And that is what my 2005 predictions will all be about.

I meant to get ’05 predictions out by Chinese New Year, but just couldn’t pull it off. So stay tuned for the next installment. If you have comments on any of this content go ahead and add it below. I will be summarizing the 2005 Prediction Blogs shortly in another article.

Cheers Rich

Posted by richardlancaster at 10:50 PM | Comments (5)
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