Jim Rickards: The FED won’t be able to bail out the system again

Commenting on what he thinks the FED may do in the event of another financial panic, Rickards said: “They’re going to freeze accounts and shut the stock exchanges because they won’t be able to bail it out again.”

He went on to say the FED “printed four trillion dollars to bail out [the system] last time, and I was standing with our modern monetary theorists to say that you’re not gonna be able to print another four trillion to bail it again.”

Rickards thinks that this will inevitably cause the FED “to turn to the IMF”.

He believes a move like this may have “a lot of implications” due to the role the IMF plays in today’s global economic framework as essentially “the central bank for central bankers”. A future bailout may result in many central banks all around the world needing to turn to the only place left with a clean balance sheet for a liquidity injection in the form of SDRs – or what Rickards calls “world money”.

- Source, Yahoo Business

Jim Rickards: How Best to Prepare for the Next Financial Crisis

James Rickards is predicting chaos on an unprecedented scale. The financial expert, investment advisor and New York Times bestselling author warns that the most devastating financial crisis yet could be just around the corner.

His suggestions for how we can protect our wealth in tumultuous times are at times counterintuitive, including steering clear of high-valuation tech stocks and being wary of “overhyped” passive investing.

In this video with Moneywise editor Rachel Rickard Straus, Jim also warns viewers to watch out for tricks being played on us all by behavioural economists.

While his predictions are provocative, he has been right in the past, sounding the alarm on currency manipulation and foreseeing the rise of negative interest rates.

Lifestyles could change immeasurably over the next century, with progress by no means a given, he predicts. So, fasten your seatbelt (or pour yourself a cup of tea), and watch our interview with Jim.

- Source, Moneywise

Rickards: The FED May Cause the Next Recession by Trying to Get Ready for the Next One

In a recent interview conducted at the Nasdaq stock exchange headquarters in New York, macro analyst and financial commentator James Rickards warned of a potential upcoming financial panic in the run-up to the release of his latest and final book in a series of four called “Aftermath“.

The bestselling author thinks that the US Federal Reserve (FED) raising the interest rate from zero all the way to the current 2.25% to 2.5% over the last couple of years may be a ploy from the central bank to give it the opportunity to then cut rates in the event of another potential economic downturn.

Rickards has had a long history on the frontlines of financial panics. He had a role as the chief legal counsel for the now-defunct hedge fund Long-Term Capital Management. The firm was infamous for the bailout it received organised by the Federal Reserve Bank of New York to the tune of $3.625 billion following heavy losses for the firm following the 1997 and 1998 Asian and Russian financial panics.

Since then, Rickards has spent time on the sidelines and bore witness to the 2008 financial crisis and subsequent bailout – this time directly from the US Treasury.

Moving forward another 10 years, he thinks we may soon be on the precipice of another major economic downturn, but this time the mess will be too big for even state-backed central banks like the FED to get us out of trouble.

- Source, Yahoo Business

Jim Rickards: Communist China Thought They Could Mimic Capitalism

The key word there is "mimic." The Communist Party [of China] thought they could finesse and control it, but it is turning out markets have a mind of their own. But the "Empire" will strike back, they have an enormous arsenal of tools they can use to try to fight this bubble.

In the end, all bubbles burst, I expect this will go down about 70% or 80% before it runs its course, but bubbles never go down in a straight line...

This could take multiple years and there could be rallies in the meantime. They need to cut interest rates, cut reserve requirements and cheapen the Yuan, sell their reserves and use that to prop up their markets. There is a lot they can do, but this is just going to grind lower...

I expect China will do something, they are probably debating it right now... They do have room, unlike the U.S., because we should have raised rates when we could have back in 2010, China still has room to cut rates, and they've got $3.5 trillion in reserves, that is a lot of dry powder.

However, this has implications, it has what the IMF calls "spillover effects."

If they have to sell their reserves to raise funds to bail out their market, what are they selling? [U.S.] Treasuries. That puts upward pressure on U.S. interest rates, now the trend in interest rates is probably down because of deflation, but in the short run, this is going to make the dollar even stronger and make deflation worse.

By the way, everything that is going on in China sort of started with the Fed. They went though a "kamikaze mission," as I call it, talking about raising rates all year. The eocnomy was visibly slowing, deflation had the upper hand, why on Earth is Janet Yellen talking about raising rates?

But as long as China was pegged, our deflation became their deflation. It was killing them so they broke the peg, but then the markets are crashing, so all these things are connected. It is not that China causes our problems, the problems actually started here, went to China, and now they are coming back...

- Source, Real Clear Politics

Jim Rickards: Should you be Preparing for a Market Collapse?

America's economy is doing pretty well these days. Considering what might happen in the event that it collapses is likely among the last things most wish to do. 

Wall Street veteran Jim Rickards believes that the time is now to prepare for what happens when the good years draw to a close. 

His latest book, the bestseller 'Aftermath: Seven Secrets of Wealth Preservation in the Coming Chaos,' details what he believes will transpire as a result of the next global economic meltdown, as well as what ordinary folks can do to shield themselves from fiscal ruination.

- Source

Why The Next Financial Crisis Will Be the Biggest Yet

Jim Rickards explains why there's a financial crisis coming, and in so doing, reviews the unusual origins of his predictive analytics tool. 

He also explores complexity theory and Bayesian statistics. Jim Rickards is a renowned author and the chief global strategist at Meraglim.

Could this be the biggest financial crisis since 2008? The biggest ever?

- Source, Real Vision Finance

Ask the Expert: Jim Rickards on a Future Global Reserve Currency & Interest Rates

James Rickards is Chief Global Strategist at the West Shore Funds, Editor of Strategic Intelligence, a monthly newsletter, and Director of The James Rickards Project, an inquiry into the complex dynamics of geopolitics and global capital.

In the first of a value-packed, two-part Ask The Expert segment, Jim answers your reader-submitted questions, including:

• Canada officially holds zero gold. Where does that leave them now?

• Is the concept of a global reserve currency becoming obsolete?

• Will the trend toward lower (or negative) interest rates ever reverse?

- Source, Sprott Money

Jim Rickards & Grant Williams: Predicting the Currency War and the Case For Gold

Jim Rickards, renowned author and economist, explains his theory on the currency war and why he believes it is important to buy gold now more than ever.

- Source, Real Vision

James Rickards: Forecasting Long Term Cycles

Rickards, who also edits the Strategic Intelligence newsletter, thinks in multi-year and often multi-decade cycles. This, however, poses certain challenges.

One of these is dealing with friends, clients, and readers who want to know what day the economic reset—which smart money managers think is coming—will happen.

(Rickards says he has never met a major hedge fund manager who did not personally own gold.)

The lawyer and former accountant won’t bite.

Rickards likens accumulating system debts, central bank stock market manipulations, and financial institution off-book derivative trading to piling snow on a mountain. Just one snowflake will set the avalanche off—you just never know which one that will be.

Rickards’ favorite talking point is that during the 1998 Long-Term Capital Management crisis, the big banks bailed out the hedge fund. During the 2008 crisis, central banks bailed out the financial institutions.

But during the next crisis, the central banks themselves will need to be bailed out, says Rickards, possibly by the IMF and through hyper-printing of a global currency.

All of this, he says, would be highly inflationary and thus boost the value of hard assets relative to paper claims.

- Source, Sprott Money Blog

Rickards Doubles Down On $10,000 Gold per Ounce Call

James Rickards, who has been warning about fault lines in America’s financial system for more than a decade, is one of the country’s most forward economic thinkers.

The prolific writer mixes with big bank board members, CIA spooks, and grubby miners in the Val D’Or Quebec pits.

After four major works—including Currency Wars, The Death of Money, The Road to Ruin, and The New Case for Gold—you’d think he’d run the gamut.

In his latest book, Aftermath, Rickards updates readers on his thinking and doubles down on his forecast that gold prices, up 25% since we published his initial prognosis in 2016, will hit USD $10,000 per ounce.

An innovative investment strategy: 10% invested in physical gold

Rickards believes that the U.S. economy is already in a depression as defined by John Maynard Keyes, which is a sustained period of sub-par economic growth.

This fact is masked by the reality that U.S. statistical agencies have redefined the way they calculate the unemployment rate, which would in fact be above 10% using previous methodologies.

Rickards’ key message—which makes him a perennial favorite at gold conferences (including, full disclosure: numerous Sprott events)—is that investors should hold 10% of their investable assets in gold, to act as a hedge against coming catastrophe.

This, he says, will come from a variety of factors ranging from a 60% stock market crash, to multiple decades of economic stagnation, to the collapse of major U.S. banks.

Rickards says financial institutions are far more vulnerable than they appear, because much of their derivatives trading is now done through clearinghouses whose debts they are collectively liable for.

Longer-term, America will be particularly hard-hit if oil begins to be priced in IMF-issued special drawing rights, as Russia, China, Iran, and Turkey combine to force accelerated de-dollarization.

The ultimate hedge

In Aftermath, Rickards assigns greater probability to deflationary pressures than he did in previous works, and thus recommends a 30% cash allocation to enable investors to profit from any downturns, with the balance of the portfolio going into equities.

Rickards figures that by using this “barbell” investment strategy, investors will be protected against wild portfolio fluctuations during a time when, for most investors, return of investment is a bigger priority than return on investment.

For example, if gold prices were to fall 20%, an investor who held 10% of his portfolio in gold would register a related setback from the category worth only 2% of his overall holdings.

On the other hand, due to gold’s counter-cyclical properties, a fall in prices would suggest that the investor’s other asset classes are doing much better...

- Source, Sprott Money Blog, read more here

Robert Kiyosaki & James Rickards: Our Forecast for the Economy Moving Forward

The increasing intersection of geopolitics and economics presents new challenges to investors.

Jim Rickards joins Robert & Kim to discuss his latest work into predictive analytics. Find out the real risks to your wealth and separate the hype from what’s important.

- Source, Rich Dad Poor Dad

Jim Rickards: Road to Ruin, Animated Book Summary

  
The Road to Ruin is Jim Rickards new book about the elites plan for the next financial crisis. 

Building on his previous two books (Currency Wars, and Death of the Dollar (which is more accurately referred to as ""The Likely Severe Loss of Confidence of the Current International Monetary System and it's Likely Replacements & What You Can Do To Protect Your Savings"") this book explores how the next crisis will actually play out. 

Why it won't be solved by injecting more liquidity (as in 2008), but will rather be addressed with something cryptically referred to as ICE-9.

- Source, Economics Decoded