As people continue to digest breaking news out of Greece and around the world, the Godfather of newsletter writers, 90-year-old Richard Russell, warned that panic will set in if we get confirmation that economist John William's dire prediction is now unfolding.

Richard Russell: "The economist Richard Koo calls this the balance sheet recession. The problem here and in the whole world is a four letter word — debt. Despite the fact that the Fed has been spewing forth trillions of dollars of fiat money, the retail public, chocked up with debt, is saving and paying off debt rather than spending more. The balance sheets of the retail public, the US, and the world, are loaded with debt.

KWN Greyerz V 2:19:2015

U.S. Economy Based On Wishes, Lies And Propaganda

The Fed is gung-ho to normalize this situation and is convinced that the economy is expanding and will be able to function with higher short rates. The big question is whether the US economy is actually improving. John Williams of Shadow Statistics claims that the expanding US economy is just wishes, lies and propaganda. Williams claims that the US is stumbling and sinking into recession.

John Williams issued the following dire prediction on January 24:

"Rising From Recession?  Strongest in Over a Decade?  Not a Chance.
Continued Economic Woes Promise Difficult Times for the United States."

Richard Russell continues below but first, here is the latest from John Williams:

Last Time Industrial Production Activity Was This Weak, The U.S. Economy Was in Collapse
– Second-Quarter Production Contracted at a 1.4% (-1.4%)
– Annual Production Growth at Recession Level

Richard Russell continues:  "This is the first time in my 65 years of writing about the stock market that I have seen investors waiting for economic evidence in order to gauge the direction of the stock market. Normally the stock market will tell us the future direction of the economy, but this time investors are waiting for the economy to tell us the future direction of the stock market.

King World News -- Richard Russell - Big Money Panicking As Legendary Economist John Williams Issues A Dire Warning

Panic Will Set In If John Williams Is Proven Correct

I now like watching the big averages in relation to their big numbers (thousand levels). As I write 45 minutes before the close, the Dow is back above 18,000, Transports are above 8,000, and the Nasdaq has climbed above 5,000. Gold is down 3 dollars to 1145.0 and silver is down 5 cents to 15.01. Investors are evidently thinking that the US economy is improving and they’re buying dollars, which are higher today. If it turns out that John Williams is right and that the US economy is slipping into a recession, there will be a panic to get out of dollars." I would urge all KWN readers around the world to subscribe to Richard Russell's 90 years of wisdom and remarkable writings at Dow Theory Letters by CLICKING HERE TO SUBSCRIBE.

***KWN has now released the extraordinary KWN audio interview with John Mauldin, where he the chaos in China and Greece, what to expect in major markets going forward, what surprises are in store for the rest of the year and much more, and you can listen to it by CLICKING HERE OR ON THE IMAGE BELOW.

KWN Mauldin mp3 7:19:2015

***KWN has now released the incredibly powerful KWN audio interview with Stephen Leeb, where he explains exactly how China is concealing its true gold holdings, where the gold is being held, what the Chinese are really up to, how it will impact the gold market, what surprises are in store for the gold market and much more, and you can listen to it by CLICKING HERE OR ON THE IMAGE BELOW.

***ALSO JUST RELEASED: A Remarkable View Of The War In The Silver & Commodity Markets And Gold Stocks CLICK HERE.

KWN Leeb mp3 7:18:2015

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The audio interviews with Egon von Greyerz, Nomi Prins, Gerald Celente, Andrew Maguire, Michael Pento, Dr. Paul Craig Roberts, Rick Rule, Bill Fleckenstein, Stephen Leeb, Eric Sprott, Robert Arnott, David Stockman, Chris Powell, John Mauldin, Dr. Philippa Malmgren, Marc Faber, Felix Zulauf and Rick Santelli are available now and you can listen to them by CLICKING HERE.