This article is released in conjunction with “Crisis Progress Report (6): Prophets Without Honor,” SLL, 4/29/15. From Lindsay David, via wolfstreet.com:
Wolf here: After any bubble, it’s always: “Nobody predicted the crash….” Central bankers don’t see bubbles. They’re not allowed to. At least officially, they don’t see them. And thus they can’t see the implosions coming. They can’t officially see these things because they help create them with their monetary policies.
Industry insiders and their financiers don’t see bubbles either because they get rich off them. Politicians and bureaucrats don’t see them because bubbles make them look good and bring in a lot of moolah.
But people do see the bubbles – which are huge and easy to see – and they do predict their crashes though they might not always get the timing right. Yet, they’re pushed aside and made the most unpopular folks around, and they’re expelled from the herd, and their warnings are ignored. It happens every time. And it happened during the Australian iron-ore bubble, whose spectacular crash suddenly “nobody was predicting.” Ha! Here’s Lindsay David:
By Lindsay David, Australia, author of Print: The Central Bankers Bubble, founder of LF Economics:
Late last week Bloomberg’s James Paton released an article titled, Gina Rinehart says ‘nobody was predicting the ore price crash’
Rinehart, “Australia’s richest woman” and “chairman of Hancock Prospecting,” as the article put it, is not the only mining head, politician, treasury employee, mainstream economist, or Reserve Banker “not” to predict the ore price crash. In fact, unless I am seriously mistaken, none of them saw the price crash coming. But they have indeed ignored all the warnings by those who did predict the crash in the spot price of iron ore.
As a clear example:
It’s no secret that back in early 2014, I made the prediction that the spot price of iron ore would breach below $20 per metric ton before the end of 2017. At the time, it was trading above $120 per mt. It’s currently trading at below $58 per mt. And in my opinion, this prediction is on track to eventually becoming a reality.
To continue reading: Australia’s Bad Bet on China