Ahead of the collapse of 2008 well known investment manager Bill Fleckenstein warned that real estate and stocks were headed for a crash. He positioned himself and his clients to absorb the brunt of the imminent hit that was coming to financial markets. Unlike the millions of people who saw some 40% of their wealth vaporized by mid-2012, Fleckenstein survived and actually profited by betting against the official propaganda.
And though most Americans have likely bought into the government’s recovery narrative, Fleckenstein isn’t convinced and he’s sounding the alarm once again.
In an interview with Eric King of King World News, Fleckenstein warns that the same machinations and corruption responsible for the collapse of our economic and financial systems in 2008 remain a serious threat today.
There’s no chance that the outcome in the financial markets in America is a pleasant one because we’ve gotten here because of the printed money.
This can’t possibly end well. This has gone on for so long.
It’s still not possible to say when it’s going to change and what’s going to be the catalyst.
The important thing to understand is that this is a very fragile structure. The market is very crash-prone. There’s not going to be any liquidity on the downside because of what’s happened in the banks — the algorithms and all that other stuff.
More capital has been misallocated and more people have behaved imprudently. They were kind of lured into it because of the Fed. You’ve got more bad paper out there in terms of junk paper and things like that.
But to know, is it going to be that much worse? Well, it likely will be and almost surely will be, but how much worse and in what way is going to be a function of what we find out that we don’t (already) know. For instance, when the housing bubble started to burst I knew that the economy was going to get destroyed because the housing bubble had been driving the economy.