"One reason that it's going to get worse is that the biggest shoe has yet to drop. Interest rates are now at all-time lows, and the bond market is much, much bigger than the stock market. What's inevitable is much higher interest rates. And when they go up, that will be the final nail in the coffins of the stock and real estate markets, and it will wipe out a huge amount of capital in the bond market. And higher interest rates will bring on more bankruptcies," says Doug Casey.
Avoid Real Estate
"It's too early to buy real estate right now, although a fixed-rate mortgage could go a long way toward offsetting bad timing. It would let you make your money on the depreciation of the mortgage, as opposed to the appreciation of the asset. There's been immense overbuilding, immense inventory. And people forget: a house isn't an investment, it's a consumer good. An investment - say, a factory - can create new wealth. Houses are strictly expense items. Forget about buying the things for the unpaid mortgage; before this is over, you'll buy them for back taxes."
The Greater Depression
"This isn't a recession, it's a depression. A depression is a period when most people's standard of living falls significantly. It can also be defined as a time when distortions and misallocations of capital are liquidated. This is the real thing. And it's going to drag on much longer than most people think."
The Price of Gold
"The increasing deficit stemming from the bailouts and stimulus packages will result in the debasement of the dollar and rising inflation. In that context, the big surprise is how low gold is right now. It's well known that even if we use the government's statistics, gold would have to reach $2,500 an ounce to match its 1980 high."
