Jim Sinclair: US Major Markets Will Implode If Emerging Markets Implode!

China credit crisisGold expert Jim Sinclair emerged from a lengthy hiatus from public commentary Tuesday to warn readers that the major US markets will completely implode should Janet Yellen follow through on the Bernanke Fed’s threats to fully taper QE.
Sinclair states that should Yellen taper seriously now, the emerging markets will implode. Should the emerging markets implode, the US major markets will also implode. The dollar would lead on the downside.
Sinclair’s full MUST READ warning is below:

2014 Silver Eagles As Low As $2.69 Over Spot at SDBullion!

From Jim Sinclair:

A key element of Chairperson Yellen’s intellectual position is that cutting down on stimulation prematurely would be the most serious mistake that can be made economically. She blames the long term desperation of the 1930s on the central bank’s then retreat from their form of QE prematurely in the early 1930s. That was before the incipient 1930 recovery had solid legs.

 

Assuming that Yellen did not follow her well known dictum and tapered seriously now, the emerging markets will implode. Should the emerging markets implode, the US major markets will also implode. The dollar would lead on the downside. She knows this.

 

The Plunge Protection Team cannot manipulate the entire world equity market so control would be lost. The US markets would tank, and gold would explode on the upside because of the implication on monetary aggregates. The Exchange Stabilization fund would be so busy attempting to hold US market from implosion to pay equal attention to the dollar.

 

Sincerely,
Jim

 

Analysis: Emerging markets as vulnerable to contagion as ever

By Sujata Rao, Daniel Bases and Vidya Ranganathan
London/New York/Singapore Mon Jan 27, 2014 1:51pm EST

 

(Reuters) – Emerging markets may be unrecognizable from the small and fragile economies that fell like dominoes 15 years ago, but they are just as vulnerable today to the same sort of indiscriminate selling when investor panic sets in.

 

As even the relatively robust economies of Mexico and Poland now feel the heat from disparate flashpoints from Turkey to Argentina, there are growing doubts that emerging markets have built any immunity to such contagion.

 

The wildfire engulfing the developing world is starting to look very like the currency runs of the past, such as the Asian, Russian and Latin American collapses that began in 1997.

 

Dominic Rossi, Global CIO for equities at fund manager Fidelity, likens the current wave of plunging currencies, equities and bonds to watching an old film – one in which some of the biggest emerging markets could feature.

 

“We’ve seen this movie before,” he said. “One emerging country after another gets left stranded on the shore as the tide goes out. The weakest ones first, Argentina and Turkey, soon to be followed by Brazil, Russia and others.”

 

Emerging markets have been inflated in recent years by huge amounts of cheap cash created by the U.S. Federal Reserve, much if which found its way into developing economies in the hunt for better returns. With the Fed scaling back the program, that flow is reversing and the currencies of countries with the biggest economic and political problems – notably Argentina and Turkey – are diving.

 

Investors’ behavior may not have changed all that much from during the past crises, even though many emerging economies now have more flexible currencies and trillions of dollars in foreign exchange reserves. There are three main reasons why these markets could again suffer the capital flight that plagued them during the 1990s.

 

 

More… 

 

 

Comments

  1. Oh the tension builds, the rubber band is stretched tighter!

  2. Was anybody listening to what O’Bummer said during his Sorry State Of The Union Address yesterday?
    He said he would create a ‘new retirement-savings program coordinated by the government,’ a further bid to appeal to American’s persistent sense of economic insecurity.
     
    Was I the only person who got the willys when he heard this comment?
    ——————————————————————————-
    Apparently, many people are less than enthralled by the performance of our leaders.  On a Yahoo message board I threw a dart at Washington D.C., after reading a news article which postulated how we may have greatly underestimated the intelligence of our ancestors.
     
    Thumbs-up for Mammoth!
     
     

    • Mammoth  I few asleep half way through but did wake up with the MYIRA comment   What a crock.  MYIRA?   nah Uncle Sam’s going to make it HISIRA

  3. And Sinclair also said 11 months ago that gold will never be below 1600 again. Oops.

    •  
      You realize that Sinclair is from the wealthiest banking family in America. It could only mean 1 thing. The banksters no longer control all the events and things turn out differently than they planned. Syria comes as the latest example. At this point we don’t even know who is going to trigger the collapse. Clearly there is case against the bankstres (and I don’t want to call them Anglo-American, because they are not). I think German Bafin has a proof. Maybe Russia and China decide to collapse the economy to prosecute the bastards, and most importantly stop financing of the war machine. You realize that no Syrian “rebels” and “freedom fighters” would happen without Saudi’s financing. So you cut financing to AlQaida and “radical Islam” will disappear. All this financing is possible through the petro-dollar Ponzi scheme. Do you think anyone is going to pay gold out of their pockets to carry on chemtrailing? No. It only works because it is financed out of our taxes through petro-dollar Ponzi scheme. So at some point some countries can say NO and will stop it. They now have gold and we all know the golden rule. Those who have it rule.
       

  4. http://www.zerohedge.com/news/2014-01-29/russia-ruble-collapse-escalates-record-low
    I thought the BRIC”S were going to take over the global economy (Willie), yet it looks like Russia, India, Brazil, and South Africa currencies are all going into the toilet.
    Once again, the US dollar is the best of the worst.   BRIC’S global trade system take over, what a joke.   

  5. Sinclair has not been heard from in quite a while.  Guess that at his age, it takes more time for the wounds from wrong predictions to heal up.  ;-)

  6. Sinclair was consistent with his assertion that the Fed was stuck with QE to Infinity and that, if they ever did stop, the economic consequences would be disastrous.  He’s really, as I read him, simply reasserting his viewpoint in light of today’s Fed alleging to withdraw another $10B a month from QE.  Given, at this point, at least the appearance of an increasing slope to the downward spiral of our domestic economy, I’d not want to take bets against his position right now…

  7. US Markets can’t possibly collapse. It’s all Insured!!! The Money Tree gives fruit eternal. So they say …

    • HA!  The story is that there are still 18000 Superbowl tickets unsold!  Maybe they’ll throw in the HotDog for free!

      18000 Seats unsold… Now THERE’S an economic indicator we can BELIEVE in!!!!

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