Mauldin:  “At some point when we have a traumatic event, something that really gives us a reason to have a new valuation, then I think we see the big one.  There is a new event out there, and the central banks are going to respond with more ‘Code Red’ policies. 

It’s a very difficult time to be an investor ... We now have to worry about what the f*** these politicians and central bankers are going to do in response to everything....

Continue reading the John Mauldin interview below...


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“They (politicians and central bankers) feel that they can substitute their wisdom for the wisdom of the market.  And we know that this always ends badly.”

Eric King:  “John, you talked about the ‘big one’ (big collapse), when is the big one going to come?”

Mauldin:  “I can cogently argue that it’s going to happen this year, but then I can give you tons of reasons why it won’t happen until 2016.  I’m not trying to be coy, I just don’t know what is going to be the driver.  I suspect it’s going to be Europe, and a European crisis is further out.

Now, they could create a crisis with the stress tests they are going to be doing.  My cynical nature says they are not going to hold real stress tests, so that’s not going to create a crisis that should be created.  Their (European) banks are massively underfunded. 

But eventually they are going with their sovereign debt issues, and budget deficit issues.   They are going to have to figure out whether they want to be a fiscal union, or break up.  I think they are going to stay together and it’s going to mean a massive restructuring of their treaty, but that’s in the future.

If we go back to what I was writing about in 1998 and 1999, I was talking about secular bear markets and how they last an average of about 17 years.  We are 14 years into this one now.  So 3 (more) years just gets us to the average.  It could go on longer.  But it really takes three really major events to bring valuations back down to those compelling low double-digit/single-digit valuations that become a spring-coil for the next secular bull (market).

So if you are a longer-term investor with some flexibility as to what you can and can’t do today, you should be hedged and you should be looking forward to the next secular bear market.  That’s going to be the time when we see a true shift.  Everybody will say, ‘Oh, I don’t want to touch equities ever again.  I’m fed up with all this’ -- just like it was in 1982.  We will (then) see a secular bull and we will all get to be geniuses again for about 17 years.”

IMPORTANT - KWN will be releasing interviews all day today with Egon von Greyerz, John Ing, Eric Sprott, John Mauldin, William Kaye, and many others.  Also, the tremendous KWN interview with John Mauldin is available now and you can listen to it by CLICKING HERE. 

© 2014 by King World News®. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.  However, linking directly to the blog page is permitted and encouraged.

The audio interviews with John Mauldin, Eric Sprott, Bill Fleckenstein, Egon von Greyerz, Dr. Paul Craig Roberts, MEP Nigel Farage, James Dines, Gerald Celente, Andrew Maguire, David Stockman, Art Cashin and Dr. Marc Faber are available now. Other recent KWN interviews include Jim Grant and Felix Zulauf -- to listen CLICK HERE.

Eric King

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© 2014 by King World News®. All Rights Reserved. This material may not be published, broadcast,

rewritten, or redistributed.  However, linking directly to the blog page is permitted and encouraged.

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