Blue chip stocks drop 80%

from LeMetropole Cafe

Everybody knows that the Dow and S+P are both down over 50% from their highs and the NASDAQ is down something like 80% from it's highs back in 2000, but that is not the real story. The real story is that the Generals of business and finance have already capitulated and surrendered 80-90% of their value in a mere 18 months or so.

For example, GM, GE, Merrill Lynch, Lehman Bros., Fannie and Freddie, Citigroup, Bank of America, Countrywide Credit, Washington Mutual, MBIA, AMBAC, Ford, AIG, The Hartford, Eastman Kodak, International Paper, Goodyear Tire, Alcoa, Xerox, Gannett, Macy's, Tenet Healthcare, Wachovia, JDS Uniphase, MGIC, Liz Claiborne, [there are plenty more] have all been hammered for more than an 80% loss since mid 2007. Do you recognize any of these names? Are [were] they all not leaders of their various industries? American institutions? Yes, they were the Generals, the leaders, BLUE CHIPS! They are all now crippled and may not even survive to help your portfolio.

Today the talk is GM's warning of bankruptcy and GE potentially having its laughable AAA rating downgraded. Here is a thought, Gold cannot go bankrupt nor have its "credit rating" downgraded, but it is a "barbarous relic" that pays no interest, so who in their right mind could need it? Heck, who needed it 10 years ago when it was $250 per ounce or 18 months ago at $600-700 [both tops in the stock market]? Back in those days you had to be wearing a tinfoil hat before your purchase, otherwise they gave you one free with your purchase of bullion. Today, it is changing, and fairly rapidly as far as I can tell since many "staid" institutions are now "diversifying" into metals [how come these guys don't have the same tin foil hat requirement we had?].

To my questions above, the answer is EVERYBODY. Everybody needed metals back then but just didn't know it yet, today everybody needs it and there is much less stigma attached. You see, the stigma is fading away because we are now in the "survival" phase and it's becoming every man, woman and child for themselves.

The Generals can't help you anymore, heck the government can't even help the Generals anymore, much less the lowly sergeants and privates. Then the question becomes, "who will help [bailout] the government? This is key, once the public comes to the stunning realization that the government can no longer help nor be helped, the tin foil hat requirement will gone for generations. By the time everyone realizes "it's over", it's too late. Too late to purchase bullion because it will have already been withdrawn from the market place, this is what is happening now.

With what I see coming, industrial stocks won't help you, cash and bonds won't help you, not even tin foil hats will help you [unless they are Gold disguised as tin]. The only bridge to the next currency is built with precious metals and you will need some metal to pay the toll. Once this "stunning realization" comes, it will be the wildest most woolliest financial scramble ever recorded in history. It is better to shop early and avoid the rush!

Got Gold?