"There are two sorts of wealth-getting, as I have said; one is a part of household management, the other is retail trade: the former necessary and honorable, while that which consists in exchange is justly censured; for it is unnatural, and a mode by which men gain from one another. The most hated sort, and with the greatest reason, is usury, which makes a gain out of money itself, and not from the natural object of it. For money was intended to be used in exchange, but not to increase at interest. And this term interest, which means the birth of money from money, is applied to the breeding of money because the offspring resembles the parent. Wherefore of modes of getting wealth this is the most unnatural."

- Politics, Aristotle, 350 B.C.

"The Jew alone regards his race as superior to humanity, and looks forward not to its ultimate union with other races, but to its triumph over them all and to its final ascendancy under the leadership of a tribal Messiah."

- Goldwin Smith, The Jewish Question, October 1881

“I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated governments in the civilized world. No longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and duress of a small group of dominant men.”

- President Woodrow Wilson 1916

“We are grateful to the Washington Post, The New York Times, Time Magazine and other great publications whose directors have attended our meetings and respected their promises of discretion for almost forty years. It would have been impossible for us to develop our plan for the world if we had been subjected to the lights of publicity during those years. But, the world is now more sophisticated and prepared to march towards a world government. The supranational sovereignty of an intellectual elite and world bankers is surely preferable to the national auto-determination practiced in past centuries.”

- David Rockefeller, Baden-Baden, Germany 1991

“It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”

- Henry Ford 

“The real truth of the matter is, as you and I know, that a financial element in the larger centers has owned the Government ever since the days of Andrew Jackson.”

- Franklin D. Roosevelt, letter to Col. House, November 21, l933

“One of the least understood strategies of the world revolution now moving rapidly toward its goal is the use of mind control as a major means of obtaining the consent of the people who will be subjects of the New World Order.”

- The National Educator, K.M. Heaton

"We Jews, we, the destroyers, will remain the destroyers for ever. Nothing that you will do will meet our needs and demands. We will for ever destroy because we need a world of our own, a God-world, which it is not in your nature to build."

- Maurice Samuels, You Gentiles, 1924

“We are on the verge of a global transformation. All we need is the right major crisis and the nations will accept the New World Order.”

- David Rockefeller 

“Today, America would be outraged if U.N. troops entered Los Angeles to restore order. Tomorrow they will be grateful! This is especially true if they were told that there were an outside threat from beyond, whether real or promulgated, that threatened our very existence. It is then that all peoples of the world will plead to deliver them from this evil. The one thing every man fears is the unknown. When presented with this scenario, individual rights will be willingly relinquished for the guarantee of their well-being granted to them by the World Government.”

- Dr. Henry Kissinger, Bilderberger Conference, Evians, France, 1991

How to Think Clearly

"Never argue with stupid people. They will drag you down to their level and then beat you with experience." –Mark Twain

If you want to begin to understand and appreciate the work of Mike Stathis, from his market forecasts and securities analysis to his political and economic analysis, you will first need to learn how to think clearly. For many, this will be a cleansing process that could take quite a long time to complete depending on each individual.

The best way to begin to clear your mind is to first move forward with this series of steps:

1. GET RID OF YOUR TV SET (at least cancel your cable)


3. DO NOT USE A "SMART PHONE" (or at least do not use your phone to access the internet)


The cleansing process will take time but you can hasten the process by being proactive in exercising your mind.

You should also be aware of a very common behavior exhibited by humans who have been exposed to the various aspects of modern society. This behavior occurs when an individual overestimates his abilities and knowledge, while underestimating his weaknesses and lack of understanding. This behavior has been coined the "Dunning-Kruger Effect" after to sociologists who described it in a research publication. See here.

Many people today think they are virtual experts on every topic they regard with relevance. The reason for this illusory behavior is because these individuals typically allow themselves to become brainwashed by various media outlets. The more information these individuals obtain on these topics from the media, the more qualified they feel they are in these subjects, without realizing that the media is not a valid source with which to use for understanding something. The media always has bias and can never be relied on to represent the full truth.

A perfect example of the Dunning-Kruger Effect can be seen with many individuals who listen to talk radio shows. These shows are politically biased and consist of individuals who resemble used car salesmen more than intellectuals. These talking heads brainwash their audience with cherry-picked facts, misstatements and lies regarding relevant issues such as healthcare, immigration, Social Security, Medicaid, economics, science, and so forth. They also select guests for interview based on the agendas they wish to fulfill with their advertisers.

Once their audience has been indoctrinated by these propagandists, they feel qualified to discuss these topics on the same level as a real authority, without realizing that they obtained their understanding from individuals who are employed as professional liars and manipulators by the media.  Another good example of the Dunning-Kruger Effect can be seen upon examination of political pundits, stock market and economic analysts on TV.  They talk a good game because they are professional speakers. But once you examine their track record, it is clear that these individuals are largely wrong, but they have developed an inflated sense of expertise and knowledge on topics for which they continuously demonstrate their incompetence.

One of the most insightful analogies created to explain how things are often not what you see was Plato's Allegory of the Cave, from Book 7 of the Republic.

We highly recommend that you study this masterpiece in great detail so that you are better able to use logic and reason.Although we recommend you read and study The Allegory of the Cave, you can get a flavor for its meaning by watching the following video. 

If you can learn how to think like a philosopher, specifically one of the great ancient Greek philosophers, it is highly unlikely that you will ever be fooled by con artists like those who make ridiculous and unfounded claims in order to pump gold and silver, the typical get-rich-quick or multi-level marketing (MLM) crowd.

STOP Being Taken

“Beware of false prophets, which come to you in sheep's clothing, but inwardly they are ravening wolves.”

King James Bible - Matthew 7:15

"It's easier to fool people than to convince them that they have been fooled." –Mark Twain

All Viewpoints Are Not Created Equal Just because something is published in print, online or aired in the broadcast media does not make it accurate.  In fact, more often than not the larger the audience, the more likely the content is either inaccurate or slanted. The next time you read something about economics or investments, you should ask two main questions in order to assess the credibility of the source. Is the source biased in any way?   That is, do they have any agendas which would provide any type of benefit accounting for their views? Most individuals either sell ads on their site or are dealers of precious metals or securities. That means their views are biased and cannot be relied upon.

Is your source is credible?  

Most people associate credibility with name-recognition. But more often than not, name-recognition serves as a predictor of bias if not lack of credibility because the more a name is recognized, the more the individual has been plastered in the media. And every intelligent person knows that individuals who have been provided with media exposure because they are either naive or clueless. The media positions these types of individuals as “credible experts” in order to please its financial sponsors; Wall Street. 

Instead of name-recognition or media celebrity status, you must determine whether your source has relevant experience on Wall Street as opposed to being self-taught. But this is just a basic hurdle that in itself by no means ensures the source is competent or credible. More important, always examine the track record of your source in depth, looking for accuracy and specific forecasts rather than open-ended statements. You must also look for timing since a broken clock is always right once a day.  Finally, make sure they do not cherry-pick their best calls. Always examine their entire track record. 

“Beware of false prophets, which come to you in sheep's clothing, but inwardly they are ravening wolves.”

King James Bible - Matthew 7:15

The above questions require only slight modification for use in determining the credibility of sources that discuss other topics, such as politics, healthcare, etc.We have compiled the most extensive publication exposing hundreds of con men pertaining to the financial publishing and securities industry, although we also cover numerous con men in the media and other front groups since they are all associated in some way with each other. There is perhaps no one else in the world capable of shedding the full light on these con men other than Mike Stathis. Mike has been studying the indistry for well over a decade. Alhough he has published numerous articles and videos addressing this dark side of the industry, the entire collection can be found in our ENCYCLOPEDIA of Bozos, Hacks, Snake Oil Salesmen and Faux Heroes
At AVA Investment Analytics, we don't try to pump gold, silver or equities like many others you see because we are not promoters or marketers. And we do not receive any compensation whatsoever (including from ads) from our content. We provide individual investors, financial advisers, analysts and fund managers with world-class research, education and unique insight.

Media Lies

If you listen to the media, most likely it is costing you hundreds of thousands of dollars in lost money at minimum over the course of your lifetime. The deceit, lies and useless guidance from the financial media certainly is a large contributor of these losses to the sheep you pay attention.

But a good deal of lost wealth comes in the form of excessive consumerism which the media seeks to impose on its audience. You aren’t going to know that you’re being brainwashed or that you have lost $1 million or $2 million over your life time due to the media, but I can guarantee you that with rare exception this is the reality for those who are naïve enough to waste time on the media.

It gets worse. By listening to the media, you are likely to also suffer ill health effects through the lack of timely coverage of toxic prescription drugs or through the ridiculous medical shows, all of which are supportive of the medical-industrial complex.

And if you seek out the so-called "alternative media" you might make the mistake of relying on con men like Kevin Trudeau or Alex Jones. This could be a deadly decision. As bad as traditional media is, the so-called "alternative media" is even worse.

Why Does the Media Air Liars and Con Men?

The goal of the media is NOT to serve its audience because the audience does NOT pay the bills.

The goal of the media is to please its sponsors, or the companies that spend huge dollars buying ads, and in order for companies to justify these expenses, they need the media to represent their cause. The media does this by airing idiots and con men who mislead and confuse their audience.

By engaging in "journalistic fraud," the media steers its audience into the arms of its advertisers because the audience is now misled and confused, so in the case of the financial media, it seeks the assistance of Wall Street brokerage firms, mutual funds, insurance companies, precious metals dealers. This is why advertisers pay big money to be promoted in the financial media.

We see the same thing on a more obvious note in the so-called "alternative media," which is really a remanufactured version of the so-called "mainstream media." Do not be fooled. There is no such thing as the "alternative media." 

In order to be considered "media" you must have content that has widespread channels of distribution. Thus, all "media" is widely distributed and the same powers that control the distribution of the so-called "mainstream media" also control the distribution of the so-called "alternative media."

The claim that there is an "alternative media" is merely a sales pitch designed to capture the audience that has since given up on the "mainstream media."  The tactic is a very common one used by con men.

The same tactic is used by Washington to convince naive voters that there are meaningful differences between the nation's two political parties. In reality, both parties are essentially the same when it comes to issues that matter most (trade policy, healthcare and war). Anyone who tells you anything different simply isn't thinking straight.

On this site, we expose the lies and the liars in the media. We discuss and reveal the motives and track record of the media’s hand-selected charlatans with a focus on the financial media.  

Why Stathis Was Banned

No one has generated a more accurate track record in the investment markets over the past several years than Mike Stathis. Yet, the financial media wants nothing to do with Stathis.

You aren't even going to hear him on the radio being interviewed.

You aren't going to see him mentioned on any websites either.

You won't read or hear of his remarkable track record unless you read about it on this website or read his books.

You should be wondering why this might be. Some of you already know the answer.

The media has banned Mike Stathis because the trick is to air clowns so that the audience will be steered into the hands of the media's financial sponsors - Wall Street and gold dealers.

And as for the radio shows and websites that either don't know about Stathis or don't care to hear what he has to say, the fact is that they are so stupid that they assume those who are plastered in the media are credible. And since they haven't seen or heard Stathis in the media, even if they come across him, they automatically assume he's a nobody in the investment world simply because he has no media exposure.

Well, if media exposure was a testament to knowledge, credibility and excellent track records, Peter Schiff's clients would be a lot happier when they looked at their account balance.

Others only care about pitching what’s deemed as the “hot” topic because this sells ads in terms of more site visits or reads. This is why you come across so many websites based on doom and conspiratorial horse shit run by con artists looking to cash in on ads.

We have donated countless hours and huge sums of money towards the pursuit of exposing the con men, lies and fraud. We continue this mission but we cannot continue it forever without your assistance.

We have been banned by virtually every media platform in the U.S and every website (mainly because we expose the truth about gold and silver).

We have been banned from use of email marketing providers.

The fact is that the Jewish Mafia has declared war on us because we have exposed the realities of the U.S. government, Wall Street and corporate America.

Note that we only began discussing the role of Jews in criminality by 2009, three years AFTER we had been black-listed by the media, so no one can say that our criticism of the Jewish Mafia has led to being black-listed, not that it would even be acceptable.

You can talk about the Italian Mafia, and Jewish Hollywood can make 100s of movies about it...


We rely on you to help spread the word about us. Just remember this. We don’t have to do what we are doing.

We could do as everyone else and focus on making money. We are doing sacrificing everything because in this day and age, unfortunately, the truth is revolutionary. It is also critical in order to prevent the complete enslavement of world citizenry.   

Rules to Remember

On Exposure: No one who has significant exposure can be trusted because those who are responsible for permitting such exposure have allowed it for a very good reason, and that reason does not serve your best interests.

On Spotting Frauds: Whenever you wish to know whether someone can be trusted, always remember this golden rule..."a man is judged by the company he keeps."

This is a very important rule to remember because con men almost always belong to the same network.

You will see the same con artists referencing each other, on blog rolls and so forth.

  • How to Think Clearly
  • STOP Being Taken
  • Media Lies
  • Why Stathis Was Banned
  • Rules to Remember
  • X close

Deflation Hype

Last month, I followed up on a discussion I began in over a year ago as to why hyperinflation would be a very unlikely scenario in the U.S.

In summary, this devastating scenario is a virtual impossibility despite the printing frenzy by the Fed because the banks have held onto most of this newly printed currency, keeping it out of the hands of consumers. (1) I discussed this fact over a year ago when I first debunked the deflation myth. (2)



Before I discuss possibilities of deflation, I wanted to summarize my argument as to why hyperinflation isn’t going to happen in the U.S., as well as the underlying motives behind this myth. I also wanted to address the motive behind the NBER’s recent announcement that the recession ended in June 2009.

Since consumers account for about 70% of the U.S. economy, how can the U.S. experience hyperinflation if they aren’t receiving the dollars printed by the Fed?

This relates to basic economics underlying the tug-of-war between supply, demand and pricing. In order to have hyperinflation, you need a relentless demand for a small supply of goods and services. It is this enormous disparity between supply and demand that drives prices to the moon.

In order to keep up with this endless demand for goods and services, more currency is printed. Wages are raised serving to flood more money into the hands of consumers, who bid up the price of goods and services even more. Eventually, this cycle leads to a currency that’s nearly worthless. That scenario represents the basic consequences of hyperinflation.

Warnings of hyperinflation have come from agenda-ridden hacks, most of which have disseminated this myth throughout the Internet and financial networks. These are the gold bugs. Many of them are naïve followers. Many more are opportunists. They’ve been trying their hardest to pump up the price of gold after claiming it’s a hedge against inflation. (3)

As I have discussed on numerous occasions beginning with America’s Financial Apocalypse (2006) gold isn’t a hedge against inflation. My 3-part series “Fool’s Gold” pretty much drove that point into the ground. (4)

I myself forecast gold to soar in America’s Financial Apocalypse.

And I reiterated my buy on gold in several articles in 2008.

“Over the next decade, I expect gold, select foreign currencies, oil trusts, TIPS, Chinese and Latin American equities to significantly outperform the U.S. stock market. Watch out though, because if things get really bad, the entire world will be affected. But that will represent a buying opportunity in Chinese and Brazilian equities.” (5)

“No matter what you want to call it, the effects will be the same – more pain to the financial industry and the dollar. But it won’t send with Indy, Fannie, Freddie or the rest of the financial industry. Most likely the automotive and airlines industries will also need a bailout – that is, unless some firm is foolish enough to buy them… you would be advised to buy gold, oil, and foreign currencies.” (6)

However, since early 2009 I have not liked the fundamental drivers of gold appreciation. Specifically, the propaganda aired by hacks has scared many of the new gold investors into thinking that gold will offer them a “life-line” when all hell breaks loose.

While gold is headed higher, the important thing to focus on is risk. The higher an asset rises in price, the higher the risk becomes because valuation (or in gold’s case since it has no inherent value) is indirectly proportional to risk. Unfortunately, most of the hacks pumping up gold lack an adequate understanding of risk and valuation as well as suitability. So they are perfect pitch men for gold.

Several weeks ago, I also discussed the fact that the term “double-dip” recession has no validity for two reasons. (7)

First, it makes no sense if you adhere to the theory of recessions and expansions as they pertain to the economic cycle. Next, the term implies the recession ended, which I have shown is not the case. (8)

Since that time, the NBER concluded that the recession ended in June 2009. This is complete hogwash. It's clear to me that the NBER has given into pressures from the White House to make bogus claims that the recession ended in June 2009.

Remember, this is an election year. With just two months remaining before facing voters, democrats are shaking in their pants because there hasn't been a single bit of good news or positive developments since Obama has been in office. Americans should be accustomed to that. Bush didn't do a damn thing for the people as well. For Americans, it doesn't really matter who wins these elections because the Washington mafia always yields the same results; results focused on empowering corporate America at the expense of the people.

While I view the NBER as more credible than other economic organizations, the fact is that they still bow down to Washington and the Federal Reserve because the organization is made up of academic economists. Have a look at the list of researchers and see where they are from. If you have a good deal of time on your hands, you might want to research their ties more closely.

Never mind all the stimulus packages jettisoned into the economy in 2009. The fact is that even if this wasteful use of tax dollars did in fact end the recession, isn't this similar to cheating?  

After all, this money has to be paid off eventually. You can never claim the economy has healed if it has not healed on its own or by instituting the types of fundamental changes that were responsible for the problems to begin with. So, ask yourself these questions...

Has free trade been restructured?

Will Wall Street reform be effective?

Does America have an affordable healthcare system?

By now, you should realize the answer to each of these three critical questions is NO.

Despite adding trillions to the national debt, the actions taken by Washington, the U.S. Treasury and Federal Reserve did not put an end to the recession by June 2009. The longest recession since the longest during the Great Depression is alive and well. In fact, it's possible this recession will eclipse the 43-month recession during the Great Depression. 

Now that the housing subsidies have expired, the Federal Reserve has tripled its balance sheet to about $2.4 trillion through the purchase of toxic assets, now that much of the stimulus funds have been spent, the economy is poised to get worse.

Of course, many Americans will accept the claims made by the NBER without bothering to recall that these same economists missed much the collapse until after it occurred. Recently, I discussed how the declining housing market is going to impact GDP and ultimately the stock market. (9)

As I have discussed since the ARRA was passed in early 2009, I can guarantee you we will see many more stimulus packages over the next several years. And each time, as tax dollars are spent, Washington will claim that the recession ended.

This recession will end. But it hasn't yet. Even when it does end, you can expect a few more recessions over the next several years. In summation, this period will be remembered as America's Second Great Depression. As long as you keep the big picture in mind, you will be positioned to avoid excessive risk and seize spectacular opportunities while others crash and burn. (10)

For short-term traders, the news by the NBER has been a dream come true. Since the news was released, the U.S. stock market broke above a critical technical level. However, with Q3 earnings approaching, I would be surprised to see these levels hold. And by the time Q4 earnings and GDP data is released in early 2011, if the stock market has not adjusted downward to reflect the real economic picture, things could get ugly. 

As economic stimulus funds and subsidies run dry, some experts are now expressing concerns over deflation. This offers yet more drama for the financial media to attract a large audience. The media only cares about drama because it attracts a large audience. A large audience brings in huge ad revenues. That’s all the media cares about. The quality of content is not a concern.

Certainly, it’s common sense to have concerns of deflation. After all, with the worst employment situation since the Great Depression, very tight credit markets, the need to deleverage and taxpayer-funded stimulus plans running dry, what else would you expect? 

U.S. consumers simply don’t have much money. Others that do are paying off debt and saving for the storm. So of course we will see some relative deflation. But we are not seeing deflation now, nor will we through the remainder of 2010 in my opinion.

Keep in mind that the deflation hacks have been claiming the U.S. has been in deflation for over two years, so they’re jumping for joy now that some credible experts have issued these warnings. However, we should question whether even the most esteemed investment experts understand what’s going on. After all, they join the rest of the world in failing to predict the collapse.

When extremists want to make a case for deflation or inflation, they point to many things that don’t matter; anything they can come up with to strengthen their argument because they have agendas.

The best way to determine the level of deflation or inflation is to look at the relative price change within a basket of goods, preferably basic necessities. Ask yourself whether energy, healthcare, food, or education costs have declined over the past few years. These are basic living items that drain working class wages, leaving little for disposable income.

The only real price declines we have seen have been in housing. In part, the housing correction has masked high inflation in basic necessities. Housing cost declines have added a large deflationary component (up to 25%) to the inflation data. This has masked the official data. But ask yourself whether the collapse in housing costs has helped you pay for living expenses. Meanwhile, employee benefits continue to be slashed which adds to inflation.

Forget the money supply and everything else the deflation hacks have thrown at you. The only thing that matters is the price of goods and services because consumers control close to 70% of the economy. Thus, any other measures are essentially meaningless.

Deflation, as it applies to consumers means the cost of goods and services declines significantly. Inflation means just the opposite. In between we have disinflation, or the winding down of prices. Right now we are seeing some disinflation in my opinion. While the U.S. economy is likely to experience short periods of deflation over the next several years, it shouldn’t be much of a problem because Washington will continue with its attempt to consume its way out of this depression.

Deflation might bear its head at a later stage as it did in late 2008. But this depression will be characterized primarily by inflation. You might be thinking this doesn’t make sense. If so, then you aren’t familiar with inflation trends. Or perhaps you aren’t aware of how Washington understates inflation data. I devoted an entire chapter to the manipulation of economic data in America’s Financial Apocalypse. Thereafter, I discussed this topic in other publications. (11) (12) (13) (14)

We will continue to experience excessive inflation of basic goods and services, like oil, food and healthcare, much as we have for the past several years.

Combined with double-digit unemployment, very high underemployment, muted real wage growth will act in unison to squeeze consumers further over the next several years. Finally, some 80 million baby boomers will have little disposable income remaining to fuel the economy. For many, it will be a silent depression.

Why will the depression be silent? Because the daily events that have caused panic will come to an end in a few years. Meanwhile, the massive tax payer-funded bailout and stimulus funds will cause most Americans think that a recovery is in place. (15)

But there won’t be bread lines. Washington has food stamps and other subsidies. Already, more than 41 million Americans are on food stamps.

An economic recovery will be an illusion much like that created prior to 2007.It will be a much different depression than the previous one. And you should expect it to be different. After all, America is very different than it was decades ago, as is the rest of the world. (16)

I discussed this many times in the past. Let’s have a look at some excerpts from an article I published in October 2008.  

The Next Great Depression
Instead of massive unemployment, we will see significant unemployment combined with massive underemployment. Already, my estimates are that the real unemployment rate is approaching 9% while the underemployment rate is 20 to 25%. Over the next few years, the underemployment rate will continue to increase and could top 50%. As well, we won’t see banks close their doors because we have the FDIC. Sure, it will run out of reserves most likely within the next 2 years, but that doesn’t matter because the Fed will just print more money, causing higher inflation. All of this will put further downward pressure on living standards. The devastation won’t be due to a crisis, it will be only heightened by a crisis. The real devastation will be due to the transfer of wealth and jobs overseas. It will be a silent depression. 


The Silent Depression

In a few years, the real estate and banking crisis will have cooled off and Washington will start reporting much improved numbers; numbers that will continue to be manipulated. In reality, things will only get worse. Real wages won’t budge, inflation for basic necessities will remain high and most likely be higher, and job quality will continue to decline. It will be a silent depression because there will be no crisis. You won’t feel the full effects on any given day. If you’re in the lucky majority, you will go to work and carry out your life as usual. But you just won’t be able to make ends meet like in the past. Each year things will get worse so you’ll spend more on credit.

It will be more difficult for your children to raise their income status because higher education is becoming an unaffordable luxury for the wealthy. Millions will be stuck in slave labor, working for low wages and no benefits. And they won’t be working in factories churning out goods for the global economy. They will be working in service jobs, tailoring to the needs of America’s wealthy.

And when you retire, only then will you realize that you’ve lived through a depression because you will run out of money. If you are lucky enough to have a home, you might have to end up selling it to pay for your medical bills, even if you have health insurance. The smaller minority will have a much worse fate.
What the “experts” don’t get is that this will be a depression that will be much more difficult to reverse because it will be gradual. There will be no urgency. Many will wake up one day in a few years and realize that they just can’t make ends meet; they’ll have very little if any retirement assets. It will be a continuation of declining living standards to a point that could lead to some major societal problems. (17)

One cannot compare the 1930s to the current time in order to determine if we are in the early stages of a depression because living standards were much lower back then. As I have stated on numerous occasions, one of the best ways to determine whether we are in a depression is to compare the decline in living standards between the roaring ‘20s and the 1930s to the decline between the roaring ‘90s and now.

If you do this you will see a similar decline. The next time some hack tells you we won’t enter a depression because there won’t be bread lines, you need to reply that there are bread lines. Washington has a different name for them. They are called food stamps and 41 million Americans are in this program.

The next time a hack tells you we won’t enter a depression because the Federal Reserve is printing money to create demand, remind them that it’s false demand; it’s short-term demand financed by long-term debt. And it’s serving to kick the can forward, ensuring a long duration of socioeconomic demise.

In conclusion, Washington and the Fed intend to create artificial demand as a solution to this depression. But this will only prolong the economic devastation, while adding to the nation’s long-term debt. While there will be brief deflationary periods, this will be largely an inflationary depression, as discussed in AFA.

The scare tactics and misguided views by pundits and hacks have been designed to create panic, so as to keep you in a state of confusion. Others want to scare you into a doomsday scenario, offering gold as the solution. Meanwhile, denials and delusions by economists are designed to keep you in the dark, hoping you’ll gain confidence in the economy; hoping you’ll go out and spend more of what you don’t have. It’s a plan to create false demand through the illusion of an economic recovery. But these tactics aren’t going to work because this is no typical recession. (18)

This economic apocalypse is not one based on lack of confidence. It’s centered on fundamental economic problems neglected by politicians and economists for many years, as I detailed in America’s Financial Apocalypse.

It would be in the best interests of the nation for Washington to admit the full magnitude and scope of the problems now, so consumers can take the necessary steps to shield themselves from further devastation. But that’s not the way things are done in America. The people come last.

Because I expect to see short periods of deflation mixed in with a longer period of significant inflation (but not hyperinflation), I’m going to give you a general investment game plan so you can handle periods of inflation and deflation.

Investment Strategy for Inflation: oil, commodities, real estate and TIPS (if Washington finally decides to accurately report inflation)

In terms of inflation, oil is the best hedge you can get; specifically, oil securities that pay good dividends like oil trusts and MLPs. Dividend-bearing securities are the most important investment to own during bear markets. And oil is the best asset to own during inflation.
Commodities generally provide a good hedge against inflation. But oil is much better because it's more than a commodity. It’s got the dollar-oil link going for it that’s so critical to the U.S. economy. As I discussed in America’s Financial Apocalypse and many times since, this vital economic link enables the U.S. to export inflation throughout the globe.
But let’s assume a magical fantasy occurred; the U.S. experienced hyperinflation. Oil would eventually soar to millions or even billions of dollars per barrel.
So if anything, investors should want to own oil because it serves as the best hedge against inflation. The next best things to have if hyperinflation were to occur would be food, water, guns and bullets, but not gold.

Investment Strategy for Deflation: cash, CDs, and select stocks

While inflation and deflation are generally bad for stocks and bonds, most experts contend that inflation is worse for bonds than stocks. Meanwhile, they also claim that deflation is worse for stocks than bonds. These are generalizations that can actually cause you to lose a lot of money if you’re not careful to dissect precisely what’s going on.

For instance, if bonds are purchased during an inflationary period after interest rates have risen significantly (in response to inflation) they can provide excellent returns. If bonds are purchased prior to heightened inflation, the low dividend won’t be adequate to neutralize the effects of inflation.

Well-managed bond funds can dampen the effects of inflation on diminished returns through prudent management of the yield curve and other prognosticators of rising interest rates.

However, open-end bond funds have excessive fees. I prefer to invest in closed-end bond funds because they have lower fees and more transparency. However, they are not without their own unique risks.

While deflation typically crushes stock values due to diminished revenues, I would expect certain companies to be able to mitigate this effect.

Defensive industries such as consumer staples, healthcare, and others are likely to outperform the broad market during deflationary conditions because consumers must buy these items. Other companies are positioned in the sweet spot because they have established virtual monopolies and can raise prices leaving consumers with few alternatives.


The point is that you must understand precisely what’s going on in the economy. You must also understand how each company makes money and identify methods companies have to mitigate the effects of deflation. Finally, valuations matter because securities pricing is directly related to investment risk.

I don’t feel that being a “good stock-picker” is going to cushion investors from the economic devastation we will continue to see over the next several years. One reason for this is because many of the stocks within a given industry have lost their distinctiveness. Therefore, it’s more important to identify industries best positioned to outperform.

Finally, the most important skill investors can have to navigate this long period of economic turmoil and market volatility will be market forecasting. Granted, this is an extremely difficult task for even the most seasoned investors.

I plan to guide my clients and subscribers of the AVA Investment Analytics newsletter through this long period of economic devastation. Our goal is to position you to take advantage of the best opportunities while minimizing risk.

There will be periods when you will be best advised to stay out of the capital markets completely, as well as periods when you should be largely invested. Recognizing these transitions will position you ahead of the curve.

At AVA Investment Analytics, we advise financial institutions, financial advisers, corporations and venture capital firms. We do research full time for a living. We do not sell securities or gold, so we have no agendas.

If you want the unbiased truth, world-class research and guidance covering economic analysis of the U.S. economy and the global economy, U.S. stock market forecasts for the U.S., China, India, Brazil, securities analysis, foreign currency forecasts, top-notch investor education, you should subscribe to the AVA Investment Analytics newsletter today. We provide one of the most comprehensive and insightful investment newsletters in the world. More important, we get things right, ahead of time. 




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