Financial Cataclysm Now!: Why Global Stock And Property Markets Are Now Going To Fall Faster And Further Than Ever Before – And How To Survive It
By John Piper
()
About this ebook
Related to Financial Cataclysm Now!
Related ebooks
The Demise of America: The Coming Breakup of the United States, And What Will Replace It. Rating: 0 out of 5 stars0 ratingsEconomics is Like Sex: Common Sense Thinking for Better Decisions Through the Taboo Topics of Money, Budgets, Markets and Trade Rating: 0 out of 5 stars0 ratingsThe Foolish Corner Rating: 0 out of 5 stars0 ratingsPlay the Percentages Rating: 3 out of 5 stars3/5The Race for Capital: And Other Out-Of-The Box Economic Arguments Rating: 0 out of 5 stars0 ratingsMessed Up!!: What's Happening to Us, America? Are We Fed up Yet? Rating: 0 out of 5 stars0 ratingsThe Great Gold & Silver Rush of the 21st Century Rating: 0 out of 5 stars0 ratingsPassive Income in the 21st Century Rating: 4 out of 5 stars4/5A Stock Investment Book For The 99% Rating: 5 out of 5 stars5/5Crazy Smart! Rating: 0 out of 5 stars0 ratingsNo Bull Information: A Humorous Practical Guide to Help Americans Adapt to the Information Age Rating: 0 out of 5 stars0 ratingsSummary of The Psychology of Money: Timeless Lessons on Wealth, Greed, and Happiness by Morgan Housel | Get The Key Ideas Quickly Rating: 0 out of 5 stars0 ratingsUncommon Counsel: An Advisor's Journey Rating: 0 out of 5 stars0 ratingsCrisis Investor: Turning Financial Calamities Into Profitable Opportunities Successfully Rating: 0 out of 5 stars0 ratingsSurvive Tough Times Rating: 0 out of 5 stars0 ratingsThe Caveman Explores Politics and Economics Rating: 0 out of 5 stars0 ratingsThe Art of Making Money Rating: 0 out of 5 stars0 ratingsMake Yourself Great Again Part 1: Mindset Stacking Guides, #1 Rating: 0 out of 5 stars0 ratingsMillennial Money: How Young Investors Can Build a Fortune Rating: 4 out of 5 stars4/5Invest Like a Wealth Manager: Simplify Your Thinking to Invest Your Money with Confidence Rating: 0 out of 5 stars0 ratingsSimple Living: Building Your Ark: How to Survive and Prosper in Uncertain Times Rating: 0 out of 5 stars0 ratingsThe Corona Dilemma: 20-20 Thinking for the Next Normal Rating: 0 out of 5 stars0 ratingsMake Yourself Great Again Part 2: Mindset Stacking Guides, #2 Rating: 0 out of 5 stars0 ratingsThe Minimalist Revolution Rating: 0 out of 5 stars0 ratingsFrom Zero to Millionaire: A simple, effective and stress-free way to invest in the stock market Rating: 0 out of 5 stars0 ratingsBluff: The Game Central Banks Play and How it Leads to Crisis Rating: 5 out of 5 stars5/5How to Fund the Life You Want: What everyone needs to know about savings, pensions and investments Rating: 0 out of 5 stars0 ratingsSafe, Debt-Free, and Rich!: High-Return, Low-Risk Investing Strategies to Grow Your Wealth Rating: 0 out of 5 stars0 ratingsBrovolution: A New Way of Thinking Rating: 0 out of 5 stars0 ratingsSelling When No One is Buying: Growing Prospects, Clients, and Sales in Tough Economic Times Rating: 4 out of 5 stars4/5
Investments & Securities For You
The Intelligent Investor, Rev. Ed: The Definitive Book on Value Investing Rating: 4 out of 5 stars4/5Stock Investing For Dummies Rating: 5 out of 5 stars5/5Girls That Invest: Your Guide to Financial Independence through Shares and Stocks Rating: 5 out of 5 stars5/5Real Estate by the Numbers: A Complete Reference Guide to Deal Analysis Rating: 0 out of 5 stars0 ratingsDay Trading For Dummies Rating: 3 out of 5 stars3/5How to Make Money in Stocks: A Winning System in Good Times and Bad, Fourth Edition Rating: 5 out of 5 stars5/5Get Rich with Dividends: A Proven System for Earning Double-Digit Returns Rating: 5 out of 5 stars5/5Just Keep Buying: Proven ways to save money and build your wealth Rating: 5 out of 5 stars5/5How to Invest in Real Estate: The Ultimate Beginner's Guide to Getting Started Rating: 5 out of 5 stars5/5Principles: Life and Work Rating: 4 out of 5 stars4/5Buy, Rehab, Rent, Refinance, Repeat: The BRRRR Rental Property Investment Strategy Made Simple Rating: 5 out of 5 stars5/5ABCs of Buying Rental Property: How You Can Achieve Financial Freedom in Five Years Rating: 5 out of 5 stars5/5You Can Be a Stock Market Genius: Uncover the Secret Hiding Places of Stock Market P Rating: 4 out of 5 stars4/5How to Invest: Masters on the Craft Rating: 4 out of 5 stars4/5Long-Distance Real Estate Investing: How to Buy, Rehab, and Manage Out-of-State Rental Properties Rating: 5 out of 5 stars5/5
Reviews for Financial Cataclysm Now!
0 ratings0 reviews
Book preview
Financial Cataclysm Now! - John Piper
www.johnpiper.info
Introduction To The 2012 Edition
When I wrote the first edition of this book in 2006 there was not a cloud in the sky but I felt certain the end was nigh for many of the absurd financial practices at large and that the false belief that property always goes up
was about to meet its maker.
So it turned out to be, but it is curious how much abuse I had to endure simply because my views were out of line with the mainstream. A web designer refused to work with me because of my cranky
ideas, a taxi driver almost, but not quite, threw me out of his cab, and my usual publishers were simply not interested (but not abusive!).
Now in 2012 the first email I sent out looking for a publisher hit pay dirt.
Perhaps this should worry me - I find market projections are far more accurate if I am in a minority of one and this is no longer the case, in fact far from it. But my projections in 2006 were based on two hard facts and these were:
1. That the global economic system was awash with debt
2. That asset values, particularly stock and property, were inflated
This is a fatal formula and, as far as I can see it remains the case today however hard the major countries attempt to debase their currencies in an attempt to inflate the price of those assets (whilst the value of these assets falls away).
Plus there is now an additional factor which I forecast in the first edition - the fact that growth has slowed dramatically which is bound to further reduce asset values. Stock prices depend on future growth and property values depend on increased demand.
I have left the majority of the text from the 2006 version of this book intact as it remains valid but I have added sections where appropriate.
In 2006 I expected sharp falls and these duly arrived in 2007. But markets always bounce on their way. The techniques I use suggest we are now finishing one such major bounce and that we will soon be headed down once again.
I expect 2012 to be a very negative year for most of the markets on the planet.
Finally in the 2006 edition I expressed the hope that if we worked together we may avoid this financial cataclysm. I now see this was a rather pointless comment as there is most certainly a tide in the affairs of men and trying to stop these financial waves would be to replicate the efforts of King Canute. These waves will have their way but there will be plenty of opportunity both on the way down and once they are over - that is the key message of this book!
Many of the greatest fortunes in the last century were born out of times when markets collapsed and it will be the same this time. Yes, the majority will suffer as markets fall, but those who are informed will see fantastic opportunities ahead - the purpose of this book is to inform!
JOHN PIPER - January 2012, West Sussex
Introduction (To The 2006 Edition)
I have always been very positive in my outlook. Most call me a born optimist. I have a good life, nestled in the Surrey Hills, my daughter is at a top university, my girlfriend is beautiful and has a good job, my business is thriving. Everything is right in my world! So how come I am here writing that it is all coming to a sticky end?
Simply, because I cannot see any alternative.
Over many years the nations of the west have pursued policies which have brought short term benefits but created long term problems. These have not been pursued by evil men in the main but other nations have been exploited. Democracy may be the best alternative but that itself is a large part of the problem causing our politicians to adopt short-term views. Maybe it is unfair to blame democracy when it is human nature to look at the short term. Most of the problems today are brought about by the simple human desire to improve living standards and then to maintain them, to cling to the status quo - at any cost!
If this book has a higher purpose it is to make us think about how we live our lives and why we need to change if we are to build something that will stand the test of time.
Certainly we cannot tolerate billions of our brothers and sisters on this planet living in abject poverty while we drive our 4x4s down to the supermarket to stock up on the local delicacies, washed down with plenty of fine wine. Marie Antoinette was there before us and she ended up without a head!
If we are not to suffer the same fate we need to learn a few simple lessons.
We cannot hope to understand everything that happens in the world today. But what we can do is develop a template, a model that explains how things work and which we can use to give us a better understanding of the key threats we face.
In writing this book I have set myself three key tasks. First, to develop just such a model. Second, I have read too many books of this sort which are littered with such expressions as in our opinion, x should happen
or on the evidence this ought to occur.
I accept that it is not possible to predict the future but I plan to be more definite than that. Third, I want this book to be accessible and readable to everyone. I have avoided overwhelming you with masses of statistics; instead I have only mentioned those of direct relevance. Only you, the reader, can judge how far I have succeeded in these three key goals.
Finally my ideal is twofold. First, that those reading this book will be prepared when the events I foretell actually occur. Second, and more importantly, that we, mankind, work together to avoid the worst of them.
My fondest wish is to be told that all my predictions were wrong because I did not take into account the actions we could take. Here’s to that!
John Piper - June 2006
Markets And How They Work
This is a book about markets but markets reflect the people we are. They reflect the lives we lead. They also definitely affect the lives we lead. The Depression of the 1930s is a good example having a huge impact on life and helping the growth of Nazism in Germany - Hitler became Chancellor of Germany in 1933. A rising market reflects the prosperity of the country and multiplies that prosperity but a falling market has the reverse effect and when the falls are severe the effect can be very, very destructive.
In this book I am warning of very severe falls to come. But without an understanding of how markets work it is not possible to understand why we are perched on the edge of a precipice right now (both in 2006 when I wrote the first edition and now in 2012). But we cannot even begin to understand markets until we understand ourselves and this is not simple. So the first matter to discuss is...
The Human Brain
Now we should all have one of these although this is not always obvious.
In fact, and this may come as a shock, we don’t just have one brain, in effect we have three! What is more they all think
different things - no wonder everything gets pretty confused!
This is how it is. From our reptilian ancestors going back millions of years we have an instinctive brain, it is this part of the brain which acts immediately to a threat. A more recent addition is the emotional part of our brains. Last, but not necessarily least is the neo cortex - the thinking part of the brain.
All of you will be familiar with all three. Instincts do not require thought, we simply act - but it is the brain that processes this action. Emotions are where we generally live our lives, I like that car, I do not like that one; I like that girl/boy, I do not like that one. There is often no clear logic to these feelings but they guide much of our actions. Finally there is the thinking part of the brain that can be useful but often gets it wrong.
All of us have a primary channel we use most of the time, but we are all influenced by all three; that is our instincts, our emotions, and our thoughts.
The structure of the brain is why we may plan things, using the neo cortex, but it does not work out in practice. As an example take the idea of approaching an attractive member of the opposite sex. The plan is simple, we approach, smile and say, hello.
Hello
is quite enough, if there is interest. A fairly simple plan but how many of us can carry it out? It can be done but most of us stumble at the first hurdle, even if we do make it to actually speak we may well stutter and fluff it. A more extreme example is rock climbing. We may have a simple plan but many