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Be careful, be cautious, and be prepared. I hope we...I mean, a lot of people won't survive, Dave. I hope I survive. I'm sure you'll survive. I hope we all survive, but only those who understand what is happening and are prepared for it will survive. This applies to all major bear markets, but the next one will be a really big one, so be careful.
Now in Washington they say that we will no longer have "bear" markets. So you don't need to worry about it anymore. So, if you believe the Ivy League-educated government officials, don't listen to me, because Janet Yellen, the Treasury Secretary, says there will be no more bear markets. I've been living longer, well, generally longer, and I've read about what's happened in history, and we've always had bear markets, and we always will, and the debt is many times greater than it was in 2008-2009.
So the next bear market is going to be the worst of my life. I'm not trying to scare people. I'm just stating a simple fact, like saying the next hurricane will be terrible. Well, the next bear market will be terrible because there is too much debt. When will this happen? I don't know. Watch gold or TV.
They will tell you. I suspect this will definitely be the longest market of my life. And that probably means the fall will be the worst of my life. You know, in the past, in bear markets, a lot of stocks have fallen 80 or 90%, which is pretty bad if you own them. And this applies to many people. There are always stocks that only fall 50% or 60%.
But I suspect that next time things will be really terrible because there is so much debt in the world , and many companies have huge debts on their balance sheets. And in bear markets, people notice such things and get scared. Usually it's something unexpected. In fact, this is how these things work: something happens where we're not looking.
For example, Ireland goes bankrupt. I'm not saying it will happen, I'm just assuming. You know, in 2007, actually, it was Iceland. Most people didn't even know Iceland existed, let alone that it could go bankrupt. And then, a few weeks later, another event occurred. And then— Bear Stearns. And then another one, what was that bank called?
Northern Rock in England. And a few weeks later—Lehman Brothers. By then it was already on the evening news. Well, it all started a year earlier, in Iceland, oddly enough . That's how these things work. Well, when unrest strikes, people historically seek a safe haven, and traditionally many consider the US dollar to be such a haven.
Although this is not true—America is now the largest debtor nation in world history— people think otherwise. So I still hold US dollars. When the US dollar has its last big rally, my plan is— who knows, of course— to sell it, and then I'll have to invest the money in something else. I do n't know where yet, and I do n't even know if it's going to turn out that way, but, you know, I don't see any way the US can continue to rack up gigantic debts and remain the world's reserve currency.
No currency has lasted more than 100-150 years as a global international currency. The US dollar has been around for a very long time. There are many fundamental reasons why this will change. You know, the world reserve currency should be neutral. One that anyone can use at any time, but Washington doesn't play that way anymore.
If Washington gets mad at you, it imposes sanctions and you can't use the dollar. So a lot of people, not me, but a lot of people poorer than me, say, "Wait a minute. This shouldn't be happening." Therefore, Russians, Chinese, Brazilians, Indians, Iranians and many others are now looking for a replacement for the dollar, and they will find it.
Ladies, if I've had any success, it's usually by finding cheap things, which means they get ignored. People are not interested in them. Where positive changes are taking place. And if you can find something cheap where changes are happening and do the research to make sure you're right, chances are you'll make money.
Although I'm pretty lazy. I don't like to trade. Trading is hard work, and I'm not very good at it. So I just try to find things that I will own for a long time because I am so lazy. But if I do my research and find the right assets, I can hold them for a very, very long time. Of course, I have to support them.
I have to stay on top of things. But this is the way I achieved some success. Oh my god, the first time I bought gold was in 1981 . Was it '60, '71, '71? Americans were still forbidden to own gold at that time. I bought some in Canada and some in Switzerland. I'm not saying I predicted the change, I just thought about it, and owning gold became legal for Americans.
So I have gold. I have silver. I am an old peasant, and all of us old peasants know: when things are bad, it is better to keep gold under the bed. You should have silver in your closet, because when times get tough, everyone will accept your gold and silver . They may not accept anything else , but they will always accept gold and silver .
It has always been that way. Hopefully, if this happens again and there is a final spurt, a rally in gold and silver prices, I will be smart enough to sell if it gets too bullish. I don't want to sell. I want to leave it to the kids, but if there is a crazy boom, I will have to sell . You have to sell during the upswings.
So, at this point, I have no intention or desire to sell my gold and silver . This isn't my first experience like this, Dave. I've seen this before . And it's starting to happen again. I do n't know when they'll ring the bell and say, "Okay, guys, it's over ." What I do is significantly reduce my positions.
I do n't have many stocks right now. I own some goods, agricultural assets. I have gold. I have silver, but I've owned them for years, and I suppose, I hope, I'll pass them on to my children so that someday they too can have gold and silver. I mean, these are things that have classically stood the test of time.
Who knows? Maybe this time it's different . Maybe this time no one will care about gold, silver, or real assets, but they always have. So this is how I plan my actions. I'm not playing for relegation yet. And the reason I'm not playing for a dip yet is that there's often a huge uptick in the last few days .
I don't know what else to call it, this "takeoff " when everything, or at least a lot of things, just goes up every day . In 1999, you know, the Nasdaq ended up doubling in 6 months. People just go crazy when something goes on for too long. That's why I'm not playing for relegation yet. Who knows? Maybe I'll do the right thing. Or maybe not . But I plan to play for relegation in the near future.
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