02-Feb-09 
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Special Bulletin, #11

By Richard J. Maybury
Copyright © 2009 by Henry Madison Research, Inc.
www.richardmaybury.com
1-800-509-5400, Fax 602-943-2363

02-Feb-09

Dear Reader,

I have not forgotten you, I just don't know what to say that isn't already in the February EWR. The economy and investment markets are stuck in the Twilight Zone.

A month or so ago, I had expected by now to be publishing a Subscriber Access bulletin announcing that I think the deflationary bottom has arrived, velocity has turned, and it is time to re-enter non-dollar assets in anticipation of huge profits in the coming runaway inflation.

But the whole thing is in the hands of Obama. Oil, copper, gold, silver, the Dow, the Swiss franc and other assets have clearly been forming a bottom for more than a month, but Obama won't stop making speeches about a "dire situation," a "catastrophe," and a "disaster." He won't let velocity turn upward.

He always tries to add some note of optimism, but won't let go of the end-of-the-world theme, which frightens people and prevents them from spending.

He is not a writer, and apparently does not realize that people do not remember whole speeches, or even whole sentences. All they retain is individual words. I think it's a safe bet that in barber shops, Saturday night poker games, and lunch counters all over the country, "dire situation," "catastrophe" and "disaster" are repeated endlessly.

Fear is contagious. At any time, Obama could trigger off a new plunge in velocity, and a further deflationary drop in the investment markets.

This makes investing a 50-50 risk. Everything is up to one man. Either he will abandon this gloom-and-doom approach, or he won't.

If he awakens one morning and decides to stop the end-of-the-world rhetoric and go to, the-tide-has-turned, velocity could soar, and along with it, non-dollar assets. If he sticks with gloom-and-doom, we'll get more deflation.

50-50 is too much risk for me, so I'm staying on the sidelines.

If Obama can't say something good, he shouldn't say anything at all. Just be quiet.

To be notified by email when my IT'S TIME TO BUY Subscriber Access Bulletin and suggested investments has been posted, sign up here. To read the bulletin, you will need the password published in the current month's EWR.

--Richard Maybury

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