I began publishing my monthly newsletter The Bob Livingston Letter™ (subscription required) in 1969. The following is an excerpt from the March 2001 issue. The article was actually written in February. Mid-March saw the Dow drop 821 points in a week and the S&P 500 lose 7 percent. A year later, the Dow had lost 28 percent and many stocks had gone bust, as I predicted.
Anybody who knows anything about the Federal Reserve and Mr. Greenspan believes that by the lowering of interest rates plus printing money that recession/depression can be averted. They also believe that lower interest rates and new money can restart the bull market in stocks.
Absolutely not so! A bear market in stocks can wipe out money faster than the Fed can create it. Ask Japan. Even with zero interest rates and the printing presses wide open, Japan is at this moment in deflation after 10 years.
Now get this: The US M-3 money stock is $7.5 trillion. But already just in the first phase of this bear market Wall Street has lost 4 trillion dollars in stock values. This is what you call a black hole and only a few people know that we are in a bear market. Proof of this is that the public is still holding their stocks hoping that Mr. Greenspan will bring back the roaring bull.
It won’t happen and most people will lose their money and their savings. A very high percentage of stocks will lose between 90 and 100% of their value before the bottom is reached.