Barton Biggs: We're gearing up for a massive rally

Last night on New York City, veteran financial forecaster Barton Biggs dropped some seriously encouraging insights that deserve their own thread. Yesterday's interview boiled down to these main points:

"We're in a financial panic,'' Biggs said during a telephone interview with Bloomberg Television from New York. "We're setting up for a really big rally. I don't mean three or four hundred points on the Dow Jones Industrial Average, I mean 1,000 points on the Dow Jones Industrial Average. I don't know if we're going to get it next week or the week after. But this thing has gotten crazy and is overdone."

``We're at a really crucial point,'' Biggs said. ``This is a time to be buying stocks globally and not to be selling them.''

``Yeah, it's scary. It's always scary at bottoms. But I don't believe the economy is collapsing,'' Biggs said. ``This is not the end of the world.''

He said something similar about ten days ago (this article), though back then he predicted this would happen over the coming months because he spotted the signal that the crisis was ending:

U.S. Stocks May Surge 15% in Next Few Months, Barton Biggs Says
``Almost every bear market ends with a double bottom, and i think WE ara in The process of Making a second bottom right now,'' Biggs, the former global investment strategist for Morgan Stanley, said during a phone interview today in Dubai. ``The bad news has been discounted, and so the news doesn't have to get better for the market to go up. It just has to be less bad than what has already been discounted.''

If you compare the charts for the Dow Jones Industrial Average and the S&P 500, the general correlations are obvious.

For the record, this guy was almost spot-on, hitting his targets nearly to the percentage, when he predicted growth in the middle of two major Dow Jones Industrial Average pullbacks last year (March and August).

I have to agree, this article definitely earns its own thread.
Stocks will always be a solid buy, regardless of any recessionary fears we face.
Ever since capitalism took off, anyone holding quality capital—meaning good stocks—is going to end up even wealthier. Or, as they say in the States: the rich get richer, and the poor get poorer.

P.S. We are at rock bottom, or at least incredibly close to it. Especially if Barack Obama wins the presidency (or even Hillary Clinton), because we're looking at a massive pivot in the entire financial landscape.

I don't believe Barack Obama, Hillary Clinton, or anyone else has the power to pivot the financial landscape at this point. Everything has spiraled far beyond control. The global market is drowning in liquidity tied up in junk assets and high-risk loans, all while the actual value of that money evaporates. As the dollar loses its strength, things will only deteriorate further. For instance, the Federal Reserve essentially dumped $200 billion just to shift the burden of the subprime sector onto everyone else. You see the same pattern in Europe—greedy financiers pocket the profits, and when they fail, they somehow conjure bailouts out of thin air. We’ll soon see what happens when the music stops. Many will find themselves without a seat at the table.
We might witness a rally, perhaps even several, but that is nothing more than wishful thinking. In the coming years, we should prepare for extremely cheap stocks.

Maria Barnes said:Last night on New York City, veteran financial forecaster Barton Biggs dropped some seriously encouraging insights that deserve their own thread. Yesterday's interview boiled down to these main points:

"We're in a financial panic,'' Biggs said during a telephone interview with Bloomberg Television from New York. "We're setting up for a really big rally. I don't mean three or four hundred points on the Dow Jones Industrial Average, I mean 1,000 points on the Dow Jones Industrial Average. I don't know if we're going to get it next week or the week after. But this thing has gotten crazy and is overdone."

``We're at a really crucial point,'' Biggs said. ``This is a time to be buying stocks globally and not to be selling them.''

``Yeah, it's scary. It's always scary at bottoms. But I don't believe the economy is collapsing,'' Biggs said. ``This is not the end of the world.''

He said something similar about ten days ago (this article), though back then he predicted this would happen over the coming months because he spotted the signal that the crisis was ending:

U.S. Stocks May Surge 15% in Next Few Months, Barton Biggs Says
``Almost every bear market ends with a double bottom, and i think WE ara in The process of Making a second bottom right now,'' Biggs, the former global investment strategist for Morgan Stanley, said during a phone interview today in Dubai. ``The bad news has been discounted, and so the news doesn't have to get better for the market to go up. It just has to be less bad than what has already been discounted.''

If you compare the charts for the Dow Jones Industrial Average and the S&P 500, the general correlations are obvious.

For the record, this guy was almost spot-on, hitting his targets nearly to the percentage, when he predicted growth in the middle of two major Dow Jones Industrial Average pullbacks last year (March and August).

Sweet. So I guess it's still too early to buy. 😉

Richard Edwards10 said:Are you holding The New York Times from its Nasdaq debut? I highly doubt you're actually counting that...

If you held any other stocks before you decided to "go to cash," as you put it, feel free to list them and when you exited. I think we'd all be pretty interested in seeing that.

Let me try that again.