Get ready to see America’s Baby Boomers going bust for the 1st time in their rich lives.
Yes, the wealthiest generation to ever live has done one thing right – it has invested in the U.S. stock market, which has steamrolled for 60 years, creating millionaires every day.
But, the system, which allowed this to occur, is nearing the end of the road.
You see, every time the U.S. stock market was in a severe bear market or a sustained sideways market, the Baby Boomers would come to the rescue.
By continually putting a portion of their salaries back into the market via the 401-K retirement plans, the market has always had new buyers to fill the bottom and begin new cycles.
Boomers are not going to be putting new cash piles into the equities markets anymore, though.
They’re reaching maximum salaries, as a generation, next year.
Said differently, the sugar daddy of the American money machine has gone dry.
Not only that, but in the coming recession, they will actually be pulling money out of their 401-K’s.
As you can see, 80 million Americans are leveraging, looking to squeeze every bit of profit, before they need the money tucked away for their retirement expenditures.
Do not count on Europeans to fill the gap, since they love bonds, not stocks.
Millennials have no money to fill this gap either.
Asian money will probably be the cure, but they definitely won’t be paying the same multiples as Americans have been.
In other words, once this boom ends, it will be remembered as the Demographic Cliff.
The U.S. is hitting its limits, right now, when it comes to growth potential.
People genuinely feel that the worst is behind them. Their jobs are more secure with openings at the highest levels ever. Their Boss is begging them not to quit, even raising wages, and their taxes have just been cut.
I smell inflation, and it smells like roses to me, since I just put 20% of my money in the natural resources sector.
The fact that oil prices are surging decimates the middle-class’ tax cut benefits, since they’re paying more at the pump. In fact, they need to get ready to pay more for just about EVERYTHING.
The FED wanted to stimulate. Well, it has, but it overshot, and now they are really making an effort to put a lid on this.
They’re succeeding thus far, but Portfolio Wealth Global sees them reaching the limit of their force to contain in about 2-6 months.
After that, inflation could easily be 2.5%-4% higher.
It is a crazy prediction, but I stand behind it. In fact, my money stands behind it.
It’s undeniable – a legendary boom, followed by a catastrophic bust. We’re going LONG commodities on the front end, and we’ll be shorting market darlings on the other side.
It’s game time – we’ve been waiting forever for this.
Research Partner, PortfolioWealthGlobal.com