Dow Theorist: Sell Everything Liquid, You Won't Recognize America By The End Of The Year

The Business Insider ^ | 5-18-2010 | Joe Weisenthal

[blam]

Dow Theorist: Sell Everything Liquid, You Won't Recognize America By The End Of The Year

Joe Weisenthal
May. 18, 2010, 8:57 AM

Image: US Army

WHOA!

Richard Russell, the famous writer of the Dow Theory Letters, has a chilling line in today's note:

Do your friends a favor. Tell them to "batten down the hatches" because there's a HARD RAIN coming. Tell them to get out of debt and sell anything they can sell (and don't need) in order to get liquid. Tell them that Richard Russell says that by the end of this year they won't recognize the country. They'll retort, "How the dickens does Russell know -- who told him?" Tell them the stock market told him.

That's pretty intense!

Update: By popular demand, here's more on what he sees in the market:

And I ask myself, "Am I seeing things? The April 26 high for the Dow was 11205.03. The Dow is selling as write at 10557 down 648 points from its April high. If business is even better than expected, then why is the Dow down over 600 points? And why, if there were 674 new highs on the NYSE on April 26, were there only 20 new highs on Friday, May 14? And if my PTI was 6133 on April 26, why is it down 17 points since its April high?

The fact is that I've been seeing deterioration in the stock market ever since early-April, and this in the face of improving business news. The D-J Industrial Average is composed of 30 internationally known top-quality blue-chip stocks. These are 30 of "America's biggest companies." If Barron's is so bullish on the future of America's

[snip]

The DJIA is up 62 as I post. See here.

[blam]

Martin Armstrong: The "Flash Crash" Was A WATERFALL Event Like The One That Preceded The Fall Of Rome

[MrB]

I don’t do much gold. Hard to use it to buy a loaf of bread or a bag of wheat.

A $1 silver coin, though, worth $20 today, is tradeable.

[Republic of Texas]

FDR was able to confiscate gold because the people allowed it. What if they don’t next time?

[Joe Miner]

Google “how to short stocks”. If you have a non-margin account google “bear etf’s”.

[Mr. Lucky]

Assuming, for the sake of argument, that this guy is right about the impending financial doom, isn’t paper currency the last thing you would want your entire worth invested in?

[Osage Orange]

So really you are still in the market, right?

I'm long QID...fwiw-

[jpsb]

thanks, since I am expecting an almost total collapse I like silver dollars. I look at them as "real" 20 dollar coins. I need to buy some more, and in fact have some in my cart but I'm waiting for silver to drop back down to 17.50 or lower before I checkout. At the moment (short term) I think gold and silver are over priced and will drop in the next couple of months. Over the long haul I can see gold at 3,000 and silver at 50+.

If you think about it we are just one crisis away from a crash, the camels back is under great stress.

[ex 98C MI Dude]

At least he would die on his feet like a man, and not whimpering on the floor like a lib, crying for someone to ‘save him’.

Which way are you going to go?

[rhombus]

OK, what’s being advised here? Should I put my entire 401K in a Money Market account?

[P-Marlowe]

FDR was able to confiscate gold because the people allowed it. What if they don’t next time?

The percentage of Americans who owned guns in the 1930 was much higher than it is now. 80% of Americans are sheeple. They will not put up much of a fuss, especially when only about 5% of the American population actually has any serious investment in Gold.

[SAJ]

There are two common and one occasional way to short stocks.

1) Sell shares short. Call your broker and say "sell short 300 shares of XYZ at (say) 40". Your broker will attempt to borrow the shares from another firm (or, conceivably, from an account w/in his own firm). Assuming he is able to do so, he'll then sell them and you receive the proceeds of the sale. If the share price subsequently moves up, you suffer a loss; if the share price subsequently moves down, you profit.

2) Buy put options. Call your broker and say "buy 3 (say) December XYZ 40 puts at the market". This is a purchase of the guaranteed right to sell shares of XYZ at 40, no matter where the share price may go, up until the 3rd Friday in December. You pay for this right, of course, so, in order to profit, the share price must decline more than a few points in order for you to profit. If the share price does not do so by December, you might lose your entire investment. Option buying should NOT be attempted by those who do not understand the pricing mechanism of options. There are any number of excellent books on the subject, the best being "Options as a Strategic Investment" by Larry McMillan.

The occasional way. There may be an ETF or ETN that deals in the shares/commodities you wish to short. These are usually, but by no means always, labelled 'short' or 'ultra-short' Blah-blah Fund(s). If the ETF is labelled 'short'/'ultra-short', then **buy** the shares of the ETF if you are looking for the share price of XYZ to decline. If **not**, sell the ETF shares short (much easier, as a rule, than selling stock shares short).

Good trading to you!

[gitmogrunt]

"Note: I don’t recognize the country NOW!

I haven't recognized it since 1967 thanks to LBJ!!

[tet68]

It sure isn’t the America I was born in.
I’m just glad my dead father isn’t around
to have to see what has become of the
country he fought for all through the
Pacific.

[jpsb]

A hurdred bucks at wall mart can buy enough can goods to keep four people alive for a month. Do that 4 or 5 times and you will be in good shape on food.

[mountainlion]

Are you looking for anything in particular in tubes. I got a couple of old radios with lots of spare tubes.

[who knows what evil?]

Those of us who grew up poor and frugal are at a great advantage in a lot of ways.

Bump that...been spreading that message for some time...

[P-Marlowe]

A $1 silver coin, though, worth $20 today, is tradeable.

I think that is a fairly good idea. One ounce Silver coins could be used as barter just about anywhere. The government is not likely to use its power to confiscate silver.

[goodnesswins]

Amen....

[silverleaf]

Sell it into things that make you self sufficient without social or govt services

Here’s a list
http://www.thepowerhour.com/news/items_disappearfirst.htm

[jpsb]

many thanks!