Eric Sprott's Latest Commentary: Weakness Begets More Weakness ~ market folly

Monday, November 5, 2012

Eric Sprott's Latest Commentary: Weakness Begets More Weakness

Playing catch-up with various market participants this week, we now turn to Eric Sprott's latest commentary from Sprott Asset Management.  Entitled "Weakness Begets More Weakness," the latest Sprott missive asks, how does the US achieve a sustained recovery if the 99% continues to suffer perpetual decline in real income?

Their full commentary is posted below, but they conclude that:

"The sad fact is that the economic reality for the average family is far worse today than it was ten years ago… even fifteen  years ago, and the trend of declining wealth is firmly in place. The youth need higher paying jobs and the retirees need  yield, and for all the trillions of dollars that the US government and other western governments have spent and printed,  none of it has addressed these key areas of weakness in a way that can reverse the long-term trend. As we approach  year-end and the finality of the US election, there will likely be numerous indicators implying a US recovery. Unless they  directly benefit the 99%, we would advise readers to take them with a large, bipartisan grain of salt. Weakness begets  weakness, until something dramatic reverses the trend’s course. The 99% are firmly stuck in a declining trend, and we  do not see it reversing any time soon."

On the same topic, earlier this morning we also posted up David Einhorn's comments on low interest rate policies and how they're now doing more harm than good.

Embedded below is Eric Sprott's latest commentary:

For more from this manager, we've in the past posted up Sprott's commentary on gold.

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