We are truly on the edge of a sea change. I have felt this for some time as I have been a follower of the Kondratieff cycle since the mid 90's. Winter should have started in 2000 but Central Bank intervention and political needs messed up the timing which now will lead us to a more severe winter. I have been 90% in PM and nat res stocks since then as the other sectors made no sense to me. The great unwashed are just now realizing that the game has no rules.

At the ski resort (I am renting a place long-term at a big discount) I meet people from all over the world while going up the chair lifts. It is very interesting to hear their perspective on what is occurring in their neck of the woods. They are terrified for their retirement funds that are "left". Pension funds and Insurance products are now questionable as the stock indices keep falling. They don't know it yet but retirement is gone for some of them. For those who own places here and I mean multiple condo units ( as in RE never goes down ) they are sitting on mounting losses and monthly payments which will eat away at what they have left as there are few buyers and even renters to help pay the mortgage. The complex I am in is brand new but almost empty as are the restaurants in the village at night. I got to know an inn keeper who has owned here since the village was built and his picture of things in the world are bleaker than mine as he hears all the stories and sees a steady and abrupt drop in business. The K winter is here with some modifications as nothing is totally perfect. PM stocks and bullion are safe during this time.

This is not ment to offend anyone but the "special me" entitlement group are the only ones keeping us afloat as they think it can not happen to them and keep spending as if the party will never end. They have now just hit the wall and no one is there who is able or willing to pick them up. Consumerism is dead.

The following is the reason why this recovery is years off.

What we all need to realize the old rule that capital eventually flows to the asset with the greatest return and that is no longer RE. Housing is becoming shelter again and will have a value related to the rental income it could earn so we still have a big drop ahead for RE values. As RE is the foundation of the mess we are in, I do not need to say more. Cash is good to have to pick up the pieces as they bottom in the years to come. I park the rest in PM stocks and bullion. For now trade your producers and take your profits.

I may not be very popular so it may be my last post as most people get very agitated and angry with me when I tell them as I see it. I will still keep my 825,000 shares of TDC bought at an ACB of .14cdn as it is a small portion of my portfolio.

So long and good luck.

Woodstock