Goldman Sachs, Bank of America, UBS all issue warnings to investors on US economy

What we’ve been seeing in the stock market in recent weeks and months could very well be the ultimate example of “irrational exuberance.”

Investors have been chasing the stock market higher in anticipation of the Federal Reserve turning on the money pumps and debasing the US dollar.

How is it that investors have come to expect a positive outcome from that?

Well, volumes could be filled answering that question, but we’d like to report a more useful exercise for your time: three of the world’s largest financial institutions have issued warnings about the US economy which can only be taken as a signal to get out of the stock market and get into safe havens.

Goldman Sachs, Bank of America and UBS have all issued such warnings in recent weeks and investors best pay attention. When folks in the business of being cheerleaders for the stock market start waving red flags, it is time to head for the exits before things get REALLY ugly…probably after election day in November.

UBS economist Drew Matus warned on Bloomberg TV that there are signs that the US economy is headed for its worst long-term decline in 60 years:

http://www.businessinsider.com/ubs-capital-stock-us-economic-decline-2012-8

Bank of America’s top economist, Ethan Harris, warns that current conditions are the equivalent of the “eye” of a hurricane. For those who don’t know, conditions are very calm and even serene inside the eye of the storm, but once it passes, the worst of the storm immediately rises up:

http://www.businessinsider.com/bofa-us-economy-eye-of-the-storm-2012-8

Finally, as if all that was not enough, Goldman Sachs chief US equity strategist, David Kostin, warns that the approaching “fiscal cliff” is a lot worse than investors realize and investors in the stock market are being set up for a nasty fall:

http://www.businessinsider.com/goldman-fund-managers-hope-and-ignoring-experience-fiscal-cliff-2012-8

What all this suggests is that investors need safe havens and alternative investments for the future. Rare coins and precious metals fit that bill nicely, since they have historically moved independently of stocks and are not subject to many of the risks that negatively impact paper assets…

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