Stock market

[Lately, Mother Earth has been angrier than we can ever recall. A friend of ours with a keen interest in the predictions of seers alerted us a few years ago to the prospect of a dramatic increase in seismic activity around now, so we were naturally eager to have him update the forecast. He has obliged with the grim predictions detailed below. Be warned that his outlook is not for the squeamish and that it suggests 2012 could be a year in which natural disasters impact hundreds of millions of lives around the planet. Incidentally, if you’d like to sample the eclectic range of Rick’s Picks commentary, we offer a free seven-day trial, including daily stock and futures recommendations.] Rick has asked me to outline the impact of potential future geological events on the U.S. economy. I am not a geologist or an economist, (although I do have an eclectic university education background) - my own personal studies for the last several decades have included amongst other things various prophecies about future events from multiple sources around the world. I write this anonymously, and am writing it at Rick's request. I am just putting it out there for your consideration - what you choose to do with this prophetic scenario, if anything, is up to you. Even the least observant amongst us is slowly becoming aware of a building 'drumbeat' of seismic events on our planet - that seem to be increasing in both frequency and magnitude and occurring in areas where we find significant populations. Recent large scale destructive events include the Indonesian tsunami; central China, Haiti, Chile and last week's western China earthquakes and also the recent eruption of an Icelandic volcano. Combined, these major seismic events have cost hundreds of thousands of lives and billions in damages.

[We wrote here recently that last week’s panic attack on Wall Street is unlikely to be the last.  The markets have since rallied strongly, but that won’t change the outlook, says a wise friend of ours who has been following the markets for thirty years. In the essay below, he explains why shouting “Fire!” on Wall Street is not quite the same as shouting “Fire!” in a crowded theater. RA] “Many years ago, while reading John Kenneth Galbraith in “The Speculative Episode,” it dawned on me that the world wasn’t necessarily becoming a safer place, particularly on Broad and Wall. If you think about military history, we’ve gone from flintlocks during the Revolutionary War with a range of 40 feet to the Spencer Repeating Carbine at Pickett’s Charge in the Civil War (every Confederate soldier died), to Hiroshima. On Wall Street, we went from the ticker tape running three hours late on 16 million shares in 1929 to program trading in 1987 when we didn’t have the Internet and you had to call your broker to know what was happening that day in the market. “Today, everyone has a quote in the corner of their screen at work or they watch CNBC at home. They are responsible for allocating their 401K online and many trade the rest of their nest eggs there too. The data processing capabilities out there can handle tens of billions of sell orders in a single day and on top of that, we have the CBOE and the E-Mini. Algorithmic Trading programs do umpteen trades a millisecond and make up 70% of the volume, one HAL versus another. Technology Produces No Buyers “The biggest problem, getting back to Galbraith, is that in the process of facilitating sellers, all the new technology does not produce any buyers. I

Even if the U.S. economy has hit bottom – a prospect that we view as extremely unlikely -- there is almost no chance the recovery will restore the nation to economic health. No one understands this better than the Baby Boomers, vast numbers of whom have seen their retirement plans go up in smoke because of the wealth-destroying effects of the Great Recession. Tens of millions of Baby Boomers are parents as well, and they are just starting to come to grips with the possibility that their children will experience a declining standard of living in the decades ahead.  As recently as three years ago, before the banking system and housing market collapsed, few would have believed America could fall so far, so fast. Now, with public, corporate and private debt hanging over us that has grown far too large to redeem, only a fool in denial could fail to see the dark shadow that has fallen over the economy. Even so, the illusion of prosperity seems likely to persist, especially with the stock market’s relentless rally, now entering its 14th month, to distract and disconnect us from the real economic world.  A comment posted in the Rick’s Picks forum yesterday by “EdwardO” [click here to visit his blog] trenchantly describes the folly of it all: “The cognitive dissonance about the land is now both pervasive and immense. The number of unemployed, underemployed, and otherwise financially and economically imperiled has ratcheted up over the last few years, and though the economic deterioration that began in earnest in early 2008 seems to have, at least by some modestly credible measures, abated somewhat in the last few months, the new normal, such as it is, is distinctly less healthy, less favorable to most, than it was. “And yet, despite the immutable facts