Spain formally became the fourth country to ask for bailout aid from the euro zone on Monday, June 25. Spain’s short-term borrowing costs nearly tripled at auction on Tuesday. Market participants expect Moody’s to further downgrade Spain’s sovereign debt to Junk status.
This is no ordinary downturn. After the biggest credit bubble in history, we face a correction on an unimaginable scale. Make no mistake about it: This is a credit-cycle bust that the government cannot stop. The losses are already catastrophic. And the massive unwinding is nowhere near finished yet…
Gold bugs have suffered one of their worst years in history, says Keith Fitz-Gerald. But the US dollar looks increasingly fragile beyond this period of short-term panic buying. And that means the outlook for gold remains strong. Keith says every investor should ensure gold forms part of their investment strategy for 2009.
"Our forecast of a year ago that the U.S. economy would enter a major recession in the fourth quarter appears valid," says Gary Shilling, adding, "We’re convinced that stocks are in a bear market that commenced last October."
