With the stock market showing weakness and gold still consolidating gains, earlier in the week, the Godfather of newsletter writers Richard Russell stated, “Yesterday the Dow declined. If this market decline continues, it's going to catch a lot of bullish economists and bullish stock-holders shocked, and on the wrong side of the fence. From the Russell perspective, the stock market is duplicating where it was in April of 1930. The market is telling us that despite the rosy expectation, hard times lie ahead.”Russell continues:
“Ironically, just as the stock market was ready to fall, the North-South Korea altercation hit the news wires. This gave the public "a clear and obvious reason" for the market to fall. But the forces behind the fall were more serious than the Korean fight. The stock market was looking ahead; and it was discounting an ominous future.
What I think we are seeing is the early break-up of the huge market top, the top that began forming in February of 2010. This is probably the biggest top I have seen in more than half a century of dealing with markets.
Over the past year, I've done my best to get my subscribes out of common stocks. I've asked (begged, beseeched, scolded, insisted, demanded) that my subscribers be out of common stocks (all except precious metal mining issues). I want my subscribers to be in precious metal items along with some cash -- cash will be handy and serviceable as long as it is accepted. We pay our rent, our restaurant bills and our taxes with cash. And we buy gold with cash. (more)
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