David Stockman Interview on King World News: Don't Buy The Dips

Today David Stockman warned King World News that investors should not buy any dips in the stock market because there is going to be a massive “selling panic” in stocks.  KWN takes Stockman’s warnings very seriously because he is the man former President Reagan called on in 1981, during that crisis, to become Director of the Office of Management and Budget and help save the United States from collapse.  Below is what Stockman had to say in part II of a series of powerful interviews that have now been released.

“Stockman: “The greatest danger is the central banks. All the central banks are out of control. They have expanded their balance sheets in a way historians someday will properly and soberly describe as lunatic. So I think it’s extremely dangerous. No one has the foggiest idea of what land mines or explosive eruptions are out there. But it’s all out there and it’s just looking for a catalyst, looking for a match.

There is an accumulating recognition that the environment is a lot more dangerous than people thought. Its not benign, it’s not that ‘the crisis of 2008 is over,’ and that ‘We’ve crawled along and finally we are nearing escape velocity,’ and all this nonsense you hear from Keynesians like Larry Summers and the economists at the IMF and the World Bank and so forth.

I think what the marketplace of the world is beginning to realize is that the opposite is true -- that we’re not getting stronger, better, and returning to normal, but instead the accumulation of all these anomalies and bubble finance effects is building huge tensions and instabilities . And as that happens, you get to an environment where some catalyst can set off a real selling panic.”

Stockman added: “Stay alert, stay out of harm’s way, and don’t believe the constant refrain that ‘this dip is a buying opportunity.’ They have been for several years because the Fed and the central banks have made it so. But unless you believe that the central banks can just keep printing money forever and expanding their balance sheets at these crazy double- and triple-digit rates, then the answer is that it’s dangerous out there and the best thing to do is draw back, keep liquid, and keep out of the risk asset markets.”

IMPORTANT - This is only a small portion of what Stockman had to say in his extraordinary audio interview.  The KWN audio interview with David Stockman discussing the Ukraine crisis, financial instability, gold, the end game and much more is available now and you can listen to it by CLICKING HERE. 

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