More Analysis Showing That A Second, Bigger Credit Collapse is Coming

When I borrow material or data from another blog, I will normally try to do so only to incorporate that material into my own commentary/analysis in order to avoid "reinventing the wheel." But the Shenendoah blog posted analysis last night that stands on its own in the way that it reinforces my post from a few weeks ago explaining that a second, larger wave of real estate/mortagage failures is building up and will lead to a much larger financial dislocation than we experienced last year. Here's the link to my earlier post:

A Stage Two Collape is Coming

Here is an excerpt from the Shenendoah post:

This was highlighted in a very indirect manner by an article in today’s Sarasota Herald Tribune in what seemed like an innocent enough article in the Monday business section titled Specialist says foreclosure flood ahead . The article is fairly standard business section material where a real estate corporation is moving into the Sarasota area to exploit the flood about to happen. The shocking part is in the article itself, where a region already technically in an economic depression is about to take another major blow according to Troy Funk of Keller Williams Realty:

“The banks have been stalling the short-sale and foreclosure process and it’s a dam that can’t hold,” he said. “They have pretty much all said the same story: Get ready. Get ready. That next wave, it’s coming.” [emphasis mine]

Funk predicts that the number of distressed properties on the market will increase three-fold in short order. “The banks can’t hold onto all those properties and they are going to start flooding the market, we’ve been told.”

Here is a link to the post:

Look Out Below

The Shenendoah blog is updated roughly once a day and I recommend it as a regular stop for people looking for the truth (the author calls himself "John Galt," after the iconic capitalist hero in Ayn Rand's "Atlas Shrugged").

When you throw the ongoing commercial real estate collapse into the mix, it is the equivalent of tossing gasoline into a napalm fire. Watch for any signs the Fed/Treasury is going to attempt to monetize this whole mess.

My suggestion is that anyone who wants to prepare for what's coming needs to significantly reduce their US dollar-based investments (stocks, bonds, real estate) and move as much as you can into precious metals and related assets (stocks, investment funds). Stay away from ETFs which do not allow investors to verify bona fide custody of the gold/silver, like GLD, IAU and SLV. Those trusts are potential frauds.