Currency Wars, Cyber Wars, Real Wars…

I woke up yesterday to the fortune.com headline: The CIA is Preparing for a Major Cyberattack Against Russia’. I’ll get to this in a tick.

But first, the article reminds me of the legendary Gerald Celente. Gerald Celente writes the Trends Journal, and has been forecasting trends worldwide since 1980. He also comments frequently in Money Morning’s sister publication, the Markets and Money.

If you’ve never watched him on YouTube, I highly recommend it. Celente is a great political commentator and calls it for what it is. He’s not just insightful, he’s surprisingly witty. You’ll have a great laugh. For instance, Celente wrote the following on 26 September in Markets and Money:

Whatever you think of Donald Trump, his candidacy is one big middle finger to the Establishment. It’s part of the worldwide rise of ‘People Power’.

Unfortunately, today is no laughing matter. The people now have close to zero power…

Celente coined the phrase ‘currency wars, trade wars, real wars’. In a USA Watchdog.com interview last year, he said:

Unfortunately, when all else fails, they take us to war. Look, go back to 1929 and the market crash. You had market crashes, Great Depression, currency wars, trade wars, world war. Voila, here we are again. Panic of ‘08, Great Recession, currency wars world war… When the market collapses, the war talk will heat up.’

The stock market hasn’t crashed. However, the real economy is floundering, and that’s a risk. In my view, Celente should change his tune to: ‘currency wars, cyber wars, real wars’.

The coming cyber war will lead to a real war

Jim Rickards, our own in-house global strategist, frequently talks about currency wars. Currency wars have played out for years, and are only getting worse. You can find Jim’s latest views, here.

Currency wars have not helped anyone. ‘Currency wars,’ Rickards writes, ‘are fought globally in all major financial centres at once, 24 hours per day, by bankers, traders, politicians and automated systems — and the fate of economies and their affected citizens hang in the balance.

In fact, combined with rising taxes and rising regulation, they have hamstrung the world economy.

This economic stagnation is causing third-party politics to rise globally; such as Pedemos in Spain, the ‘Pirate Party’ in Iceland, Le Pen in France, and AfD — the anti-immigrant party — in Germany. The political elite are worried, and don’t want to lose power. They like things as they are — with most of us down the bottom, and them on top.

However, with Donald Trump — an anti-establishment candidate — gaining momentum in recent months (although, perhaps not in the last few days), the political elite is worried, and planning drastic measures. The political elite won’t allow an anti-establishment candidate, at any cost. For this reason, they’re trying to blame Russia for influencing the election and distract the people.

Fortune.com reported yesterday (my emphasis added):

NBC News reports that the CIA is developing scenarios for an electronic attack on Russian leadership. According to sources including current government officials, the intent is to “embarrass” top Russian officials through “clandestine” and widespread hacking.

Vice President Joe Biden seemed to be pointing to just such a possibility during an appearance on Meet the Press airing today, when asked by Chuck Todd why America hasn’t responded to Russian attempts to interfere with the Presidential election.

We’re sending a message,” Biden said, with a barely-suppressed smirk. “We have the capacity to do it. He’ll know it. It’ll be at the time of our choosing, and under the circumstances that have the greatest impact.”

Well, that seems like a smart move…

If you don’t know the backdrop, as I said above, the US has blamed Russia for influencing the election. It holds Russia responsible for feeding ‘WikiLeaks’ with confidential information which is impeding the Hillary Clinton election campaign.

While that’s not good news for the political establishment, there is zero evidence of Russia hacking anything. Of course, we can never know the truth beforehand. The US keeps a lot of confidential information secret for a reason.

Nevertheless, the world — and this madness — continues…

Prepare for the worst

It’s clear that a cyber war is coming soon. Sadly, this may well lead to a real war.

If that happens, the stock market could see a major correction. After all, I don’t expect the majority of people are prepared for a global war. That would cause a fair bit of shock to the system, and could hit the stock market.

Vern Gowdie, Editor of The Gowdie Letter, is prepared. Even without a global war, he believes that a stock market crash of up to 80% is imminent. He recommends strategies to protect and prepare his readers for just such an event.

That’s one more highly experienced voice recommending caution in this environment. The stock market has been choppy all-year. The US stock market remains almost unchanged from the start of the year.  And the Aussie stock market continues to struggle.

With cyber war and even real war looming, this picture is likely to get a lot gloomier before it gets any better. If you want to protect your wealth, I recommend checking Vern’s work out here.

Regards,

Jason Stevenson,
Resources Analyst, Money Morning


Money Morning is Australia’s most outspoken financial news service. Your Money Morning editorial team are not afraid to tell it like it is. From calling out politicians to taking on the housing industry, our aim is to cut through the hype and BS to help you make sense of the stories that make a difference to your wealth. Whether you agree with us or not, you’ll find our common-sense, thought provoking arguments well worth a read.

Money Morning Australia is published by Port Phillip Publishing, an independent financial publisher based in Melbourne, Australia. As an Australian financial services license holder we are subject to the regulations and laws of Corporations Act and Financial Services Act.


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