Conditions may be ripe for a global market collapse.

I will be the first to say that nobody can predict the future.  I also respect the fact that some people are pretty fair at predicting direction while others are pretty good at predicting the timing but pretty much nobody gets them both right at the same time.  But since that doesn't stop anyone else from flapping their virtual gums, why should I be held to a higher standard?

I like watching stock charts in the same way that a hunter watches herd movements.  It is not an absolute predictor of the next step but it can give a good idea.  Right now the charts are perfectly set up for a major 3rd wave Elliott style collapse.  I'm not saying that it must happen right here and right now but the odds do

favor a mass "run on the markets".  5 waves down finished the 1st wave of this sequence and we might just have finished the 2nd wave retracement.  The result is a very ominous declining double top.  A break out of the downward sloping olive line would make me reconsider but it seems to me that all the unkeepable promises in the world have only kept the Ponzi plate spinning.  No real progress has happened and in fact Bernanke has signaled that he is out of gas in his helicopter.  Besides, the fuel source for the debt Ponzi which was, of course, debt, is beginning to be seen as a bad thing by the American voter.  All of a sudden, deficits are beginning to matter again.  It means that buying our way out of this hole with more debt is going to be impossible.  People are tired of living in fear and they are starting (very early still, but starting nonetheless) to face the debt down.

Combine that with the fundamentals and you still can't guarantee anything, but your odds of being right go way, way up.  And so the fundamentals are that a corrupt money supply consisting of fiat currency (aka debt money) and fractional reserve banking (aka credit/debt) have created a global debt Ponzi which must either continue to grow or it will deflate rapidly.  The marginal places will get hit the first and the worst which is why the Eurozone looks more like a battle zone and everyone is preparing for a Greek exit from the common currency.  Of course, when they do that, their debt to others will collapse and never be paid back.  I don't mean part of it won't get paid back.  I mean that virtually none of it will be repaid.  At least not without war.

Picking up speed in a very Greek like direction now are Italy, Spain and Portugal.  When they roll over, and they will, then France and Germany will also roll over.  How rich are you really if your debt slave defaults?  How can you make payments on all those factories if those who you were "selling" the goods to flip you the bird and tell you to have a nice day.  And then there is China.  What a massive real estate bubble they have.  I predict that China will probably have the worst bout of civil unrest and violence of any affected country.  I expect it to get pretty bad in some places over there.  It's one thing to be lied to like we were in the states.  But in China they were darned near tied down and then lied to.  Even those who did not believe the lies could not escape the system.  Well, maybe a relative few at the top.  In the US people will get screwed as well but they will have only themselves to blame for going along with the scam.  In China it wasn't a matter of going along.  It was a matter of survival and it changed the way people treated each other.  This is why I suspect their anger will be far greater: they were forced to believe in the system.  When the system fails them as it must, there will be blood.  Unfortunately, the export-driven Chinese economy seems to be rolling over right now.

The normal mechanisms for trying to soften the crash are money printing, capital controls, price and wage freezes, etc.   All of these are likely to benefit gold holders.  Right now there is a global circular chain of currency debasement and collapse happening.  Look at Greece for example.  Anyone there who hasn't moved his entire savings into gold is a complete fool.  Greece is going to leave the Euro one way or another because it can't pay its Euro denominated debt.  When that happens its credit will go to $hit and its money will likely be devalued big time: 50-80% with a week or two of the Exit Event.  Same happened to Iceland when it defaulted.  Gold is the only safe haven for them.  There is virtually no other way it can turn out.  People of Greece, are you listening?  Get your a$$es down to the gold broker and buy metal!!  People will begin to learn this as the serial defaults continue not only to occur, but to get bigger with time.  People in the most marginal countries will come to undertand that you either get into gold or get wiped out.  The US will have its future shocks as well and they could be quite significant, but not as bad as the most marginal players in the world.

When IBM and McDonald's and Apple shares begin to tumble with big gaps downward then it is the sign that the big money is bailing on the market.  They are now canaries in a stock market collapse coal mine.  A rapid collapse could easily follow when these untouchable stocks begin to get sold off to pay the margin calls on the weaker stocks.  Each time a country defaults on it debt, gold should get a shot in the arm because if you can't trust sovereign debt then the only real haven left has to be gold.  Gold is old money.  How old? Nasa suggests that it is born in neutron stars. Whether or not that is true, we do know for sure that it is never as a result of government decree.  Gold was among the first things on record to be used as money.  It will likely be among the last things standing as money.