The Most Important Investment Report You'll Read in 2009

This is the full, 10-page December issue of the Elliott Wave Financial Forecast. No excerpts or samples - it is the entire issue, free with a Club EWI signup.

Nystrom's testimonial: Elliott Wave International is an advertiser on this site because I have been a subscriber to their newsletters for years. Last year their timing and forecasts were particularly incredible. They caught the huge stock market slide, as well as the US dollar rally -- when nearly everyone else was expecting a dollar collapse. When nearly everyone was calling for runaway inflation, they correctly anticipated our persistent, ongoing deflation. Most people lost money in the stock market last year, but not me. I have EWI to thank. Seriously.

This is your chance to get a free look at December's Financial Forecast. You can support one of the DP's advertisers, which helps me to keep this site on the air, and get some insight into opinions that I guarantee you won't read anywhere else.

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If you think that we're in for hyperinflation, I invite you to take a look at the other side of the argument. The Fed/government is not "printing money." That is a gross oversimplification. They are in fact creating credit, and there is a huge difference. Money, once printed, goes into circulation and piles up in wheelbarrows - see post WWI Germany and Zimbabwe for examples.

Credit is only a bookkeeping entry, which is created from nothing, and as we have found out in the current "credit crisis," can and does disappear back into nothing. The result of excess credit creation is inflation -- for a while. But that inflation is over. The debt bubble has burst. Anything purchased on easy credit - i.e. houses, cars, stocks, oil futures - is now collapsing in price. That is deflation, not inflation, and it has yet to fully run its course.

Who's got the cash to buy a house, a car, or even a new laptop computer? Without easy credit, very few can afford these things. The result is a drop in demand. We see it everywhere - in houses, cars, computers, consumer goods... No more easy credit = no more sales = prices must fall. This is deflation. The government is trying, desperately and ineptly, to support prices, to no avail. They've dumped hundreds of billions of dollars into the banking system in an attempt to "reflate," but the banks are simply hoarding the money. They need the money in order to stay solvent, and are pumping it back into US Treasuries! The government's bailout money is just going back to the government to keep it solvent! This keeps interest rates low, and it keeps the government funded. Strange as it may seem to us here on the DP, US Treasuries are still viewed as the safest debt instuments in the world.

But surely this cannot last, the inflationists think. Eventually the money "on the sidelines" will rush back into housing, stocks, commodities, etc. causing the much anticipated hyperinflation. I agree it probably will -- someday. But we all know that the market can stay irrational longer than you can stay solvent. If you're looking for hyperinflation anytime soon - i.e. within the next couple of years, I think you're barking up the wrong tree. Japan has been in a deflationary spiral for the past 19 years, since 1990, putting the Nikkei at 1982 levels! If that were to happen here, the Dow would be back around 1,500. And that, friends, is not impossible.

Japan has kept official rates low for years, and is spending like mad. Their national debt is 160% of GDP, the highest in the industrialized world. So where's the inflation?

Download the December EWFF, consider it and come to your own conclusions. The market has not bottomed. It has already fallen 50%. There is nothing stopping it from falling 50% again. And again. And again. If you haven't taken this possibility into account, you haven't done your homework.