Human nature loves to follow the crowd, especially when it comes to investing.  Years ago mutual funds were the road to riches for Bay and Wall Street.  Few investors made money.  Then came the ETFs which have been a gold mine for the companies managing as each trading day all funds must be reset to maintain the balance as required by the ETF.

This decade the road to riches has been buying real estate.  Stock markets have also been very kind as they are trading at their all time highs in the U.S. even though corporate earnings are down from two years ago. Real estate and stock markets have benefited from zero interest rates. Falling interest rates push up asset values.  Investors have benefited from this, but only on paper, unless they sold to rent or to downsize. 

People either believe the good times will never end, or, they will be smart enough to get out the day before the correction begins.  If they are correct then this will be the first time in economic history.  Unfortunately, history and common sense says, once again, these people will be wrong and lose a large portion of their savings.  They will end up deep in debt, and will have a poor future for their retirement.

Today, yellow lights are flashing.  Personal and national debt around the world is skyrocketing with not one government attempting to bring down their wasteful spending.  Consumers have been on a record spending spree, with a large portion of the spending via debt.  When in Canada the debt is at $169 versus $100 of income, trouble is coming for the consumer and the economy.

Gold is telling us deflation is coming.  Platinum prices are telling us car sales are about tumble.  We have record surpluses in natural gas and oil.  Farmers are producing too much food.  Stores are over flowing with goods.  The Baltic Dry Index confirms weak world trade.  President Trump is doing everything possible to destroy free trade.  The CRB index continues to slide as weak prices are a sign of deflation.  Until this decade it was rare for the index to go below 200.  Since mid 2015 it has been rare to be at or near 200, trading mostly around 185.  The all time low was set on February. 11, 2016 at 155.53.

Any real estate and stock market pull backs will wipe out trillions of dollars, again 100% deflation.  It will take years, maybe over a decade, to recover most of this lost money.

Asset values have peaked and are about to tumble.  Thanks to debt, consumers have less cash to sustain the economy.  All this means is time is running out for the average investor.  Today, as deflation grows, cash becomes the best investment followed by strong companies that have cash and a reliable dividend.