If you are unfamiliar with trend forecaster Gerard Celente, please see this post from exactly a year ago. [Jan 12, 2010: Trend Forecaster Gerald Celente on Yahoo Tech Ticker] His long term track record is quite compelling, but obviously not as useful for short term investment decisions - these are more broad societal trends. While I generally agree with a lot of what he says in the long long term, we have seen the past 3 years that governments and central bankers will do anything to kick the can down the road - so I disagree with the timing of things. That said, worth a listen if you agree or not.
Before the Yahoo posts here is a general interview on his views on 2011
Yes, the economy is not robust, growth still hasn't returned to pre-crisis levels and unemployment remains above 9%. But by most metrics things are getting better, not worse. In the accompany clip, Aaron and Henry ask Celente how he accounts for this.
Celente argues his dire predictions would have come to fruition if it had not been for an unprecedented set of bailouts that continue today. Most shocking to Celente was the disclosure, in late 2010, that the Federal Reserve lent hundreds of billions to foreign banks to bail them out during the height of the crisis in 2008 and 2009. Absent those kind of schemes, if capitalism take it's course, at some remote level it used to be, we see the crash, he says. (Mark's note - there is very little capitalism happening outside of small business domestically - we have corporate socialism in the States, but mostly focused on big business. Where the lobbyists are the money goes. The savers and average folk will be sacrificed to keep the status quo for as long as possible - hence we can forget about 'capitalism washing out the weak players' unless you are the part of society that does not have a lobbying firm working for you.)
Here's how he puts it in his Top Trends of 2011 release:
In 2011, with the bailout funds and arsenal of other schemes to prop up the economy depleted, teetering economies will collapse, currency wars will ensue, trade barriers will be erected, economic unions will splinter, and the onset of the 'Greatest Depression' (a trend we forecasted before the massive bailouts existed) will be recognized by everyone… (Mark's note - I'd argue we are already in currency wars as the 3 main currencies of the world are in a race to the bottom, with policy makers making decisions to debase the savers of their countries)
The only way to avoid the coming disaster is do what we did coming out of the Great Depression - start manufacturing quality goods the world wants. You can't print your way out of this, he argues.
The only way to do that is to improve productive capacity through either manufacturing industrial goods or technological innovation. Otherwise, Celente says the Greatest Depression is inevitable.
In case you're obsessing about normal problems like your food being overcooked, your clothes not fitting quite right, or your kids not doing their homework, don't bother.
Because soon, says trend-forecaster Gerald Celente publisher of The Trends Journal, you're going to have a lot more important things to worry about.
Such as a huge spike in crime, as towns and cities are forced to cut back on police enforcement to pare their massive budget deficits.
And higher taxes, as the government tries to save its own skin by producing revenue any way it can.
And a loss of liberty, as the government tries to preserve its own power by tracking every aspect of your life.
Fortunately, says Celente, civilization itself will not collapse. But it's going to get really bad for a while.