Moody’s: Worst sovereign credit outlook since 2012 …

According to a recent report from the ratings agency Moody’s, some 26 percent of countries rated now have a “negative” sovereign debt outlook, up from 17 percent at the end of last year.

That’s also the worst sovereign credit outlook since 2012.

Moody’s has it right, but I think it’s conservative. I think sovereign debts are far worse than anyone would care to believe. After all, global economic growth is anemic and there is over $60 trillion in sovereign debts outstanding — and that’s just the debt that is “officially” acknowledged.

There’s also the unofficial sovereign debt, like the more than $170 trillion that the U.S. owes in the form of various IOUs to Social Security, Medicare, Veterans Affairs and an assortment of nebulous promises made that are well, nebulous, but nothingness promises.

Thing is, it’s all coming home to roost. Over $1.3 trillion in losses were incurred in government bonds in the days since Trump was elected. Our creditors figure that Trump’s proposed tax cuts are going to blow the debts out further … and/or they are worried about his isolationist policies and desire to renegotiate trade deals

Over $1.3 trillion in losses incurred in govt. bonds in the days since Trump was elected.

So they are selling like mad and recoiling from financing our country. Who can blame them? Would you finance Europe and its debts? I wouldn’t. Would you finance Japan and its debts, which equal 229% of GDP? I wouldn’t.

Would you finance the United States’ near $200 trillion of official and unofficial debts when you know it can never be repaid, and that the debts will likely just keep on growing …

Or President-elect Trump will simply come in and renegotiate the debt making you take a 50% or more haircut?

This is the sovereign debt crisis I’ve been warning you about. And according to my models, it’s just getting started. Trump is going to have his hands full.

My view: Don’t go anywhere near the bond markets, except triple-A corporates and even then, only if you have to.

Instead, buy blue-chip stocks on pullbacks … buy gold when I tell you to … and start preparing for a five-year roller coaster ride through hell.

Best wishes,




Larry Edelson, one of the world’s foremost experts on gold and precious metals, is the editor of Real Wealth Report and Supercycle Trader. Larry has called the ups and downs in the gold market time and again. As a result, he is often called upon by the media for his investing views. Larry has been featured on Bloomberg, Reuters and CNBC as well as The New York Times and New York Sun.

Comments 35

Peter Moyes November 16, 2016

To whom at the sovereigns owed to?

gordon November 17, 2016

The Fed, central banks, Rothschilds the .001 pick one.

satan smith November 17, 2016

how about all of them they create money our of nothing

Eddie November 17, 2016

The Rothschilds are nothing nowadays, power and wealth is nowhere near people like Donald Trump or Warren Buffett. The largest owners of US Debt are China and Japan. The UK looks like the 3rd largest owner, but that is an illusion because the Arabs and other investors who want to remain anonymous buy their debt through secret hidden UK companies in order to register the owner as if it is a UK bank.

Eddie November 17, 2016

The Rothschilds are small fry. They only had big wealth 200 years ago when they financed Napoleon.

Dick November 18, 2016

Not so. They own much of the central banks in the world .

Dick November 18, 2016

USTax payer are the largest holders of debt. The debt you speak of is funded by the Power to tax their subjects. We are subjects.

tommygun November 16, 2016

What effect will all these changes have on the residential real estate market and interest rates?

Marc November 16, 2016

Thanks Larry. I think you are spot on with this one. I see the perfect storm brewing. Here in Canada you can see the inflation in food, and gas. You can see it in homes too. I think they opened pandora's box here and they can't close it now. I think hyperinflation is just around the corner in Canada and it may happen elsewhere too if it hasn't already started. I am loading up on gold. A full 60% of my portfolio. After all it is on the TSX. Keep up the good work.

gordon November 17, 2016

Marc if what you are saying is true will I get a 25% increase in my COLA this year. The government must have misread inflation last year I only got 1.3%. Would the government lie about inflation figures to me??

Eddie November 17, 2016

If you read Larry's last article, it might be too soon to get into gold.

robert egan November 16, 2016

Mr. Edelson, Your A.I. interpretation of the direction of the Gold Market has recently failed. You expected Gold to bottom around Nov 2 and rally into mid December 2016. The opposite has occurred. It appears that a down move to the Dec/Jan 2016 lows now exists. Rob Egan

gordon November 17, 2016

robert egan The ground must be plowed the seeds sown and fertilizer applied before the plants will grow

$1,000 gold November 16, 2016

wasn't moody's (and others) the one who gave lehman a good rating before it collapsed in 2009?if i recall, i think the weiss ratings were one of the few that got the bank ratings right.

$1,000 gold November 17, 2016

check out the TYX it likes rate hikes. but if you like really spicy food, the TMV likes rate hikes more. i'm up about 30% this month. i'll let it ride until decemeber. maybe another rate hike. this is a pretty easy play.

UDO November 16, 2016

tommygun it depends where you live . In Canada - Vancouver you can not get a house under $ 900,000 anymore and that is not even directly in Vancouver - it's a sad story . Old buildings get demolished to make room for luxury condos and the homeless are even more homeless now .

WasteLand Warrior November 16, 2016

But in Montreal its great! we just bought a second home for my mother, a small older 2 bedroom bungalow with a nice garage and lots of parking, across the street from the water with a unimpeded sunset view and only a half hour from downtown for $200,000!. you can keep your Toronto and Vancouver real estate! Montreal is still very affordable for a big city.... The prices seem like they are coming down since the Federal Governement tightened up the financing rules for mortgages

Dale November 16, 2016

Hello Larry , The good news ? we get a five year roller coaster ride ! The bad news is its going to go through hell ! I am relieved that things are pretty much the same as before in as much as we are all facing the prospect of a horrifically barbaric hysterical debt frenzy unless by some twist of fate bright creative minds offer an alternative .Ironically however counter intuitive. President Trump with his unfortunate expertise managing bankruptcy may be at this point in time the best man for the job . In this carnival of errors my eye is on the lookout for cotton candy !

Jim Lowe November 16, 2016

Larry; the dollar is now up. Does any American good come from that?

Ferrari fred November 16, 2016

Give us your take on Gold! Is India the problem?

JD November 16, 2016

I think the selloff is because the Fed is going to have to raise rates to follow the 10 yrs that are already rising which drops the price of the bonds....and thus people are selling because rates can really only go one way from here.....up. Nothing to do with the election. This was already happening.

Wolfgang November 16, 2016

There will be no hyper-inflation. Instead, prices will go up quadruple over the next 5 years in all developed countries. Gold will hit $5000 by 2021. By then, sovereign debt will be less then 25% of GDP and major currencies can be backed by gold. This assumes that we will still be around then

brent shannon November 17, 2016

Larry I am a lifetime member to Real Wealth Report and the Gold Mining Millionaire. I have been a member of the Real Wealth Report for several years and just became a lifetime member and added Gold Mining Millionaire. I would like to say it seems that you have been off the mark since you hit the Oct 7th prediction. I also would like to access the historical Real Wealth reports but they are not showing up on the website the way they used to. Can you fix this? Also the direction to the Gold Mining Millionaire does not have a pointer from the other sites. Any way I have bought some of your Jr Gold minors recommendations at your suggested price and they have been down ever since you recommended them. BTG Timmons, KLDX. I realize that now that Donald Trump has been elected and that inflation does not seem to be eminent, how long or what is the stop prices for these companies before I lose too much money since the previous issues are not directly available or easy to get to on the Real Wealth website or money and markets. It looks like some of the other market analysts have been closer to the mark and predicting lower prices for gold for the foreseeable future deep into next year 2017 of 1000.00 per/oz. and lower. Looking for help to prevent losing any more of my investment. Regards Brent Shannon.

gordon November 17, 2016

UDO And the minimum wage is $15 an hour. In about 20 lifetimes the house should be paid for.

william williams November 17, 2016

Was this the first presidential election where the daughters of both candidates had father-in-laws who had been in prison??? Is that shocking or what??? I could not believe that Christie thought he would get a position in any administration where he had prosecuted the father-in-law. And now the son of one of the imprisoned in laws will get a national security clearance! Is this a first for this, or have I just pulled my head out of the sand for the first time????

Frank November 17, 2016

DT says "I know the tax laws better than anyone." Yeah, right. In addition to lying, he is also an expert at bankruptcy, having done it at least six times. Make it seven, when the U.S. becomes his next victim.

H. Craig Bradley November 17, 2016

Crying Wolf We have been hearing this same message for about 9 years now. Its getting to be routine. Bond market crisis ( Yes, candidate Mitt Romney forecasted one would happen sometime during President Obama's second term). Then the urban legend of so-called "The Great Rotation" out of bonds and into stocks ever since 2010 . Well, certainly not yet. How about NEVER ? Most of the public is inured to this kind of stuff. Fact is, hardly anyone believes it. So, you are largely talking to a wall.

Dick November 17, 2016

You are right on.

Dick November 17, 2016

His only wall has been a wall of LIES.

Ian K November 17, 2016

Thanks, Larry. I got into GDX last week and am down almost 20%. Wait? Sell and get in later? I agree with you that long term gold is bullish, but my timing was poor.

Craig Bradley November 18, 2016

Don't forget, Nobody can consistently predict or time markets successfully. Gold and Silver are especially volatile, so its about the same as trying to hit a moving target. Low percentage shot.

Dan S. November 18, 2016

The sovereign debt is not a problem as the governments will just wipe the slate clean and start again. This is much the way the stock market is being manipulated to protect retirement accounts. Currencies really don't have a value anymore, back by absolutely nothing whatsoever, its merely a tool to keep the peasants working. The elitists use it to to gain prestige and status plain and simple. Life is what really matters when you're gone all that printed toilet paper means Nothing, Zilch, Nada.

William November 18, 2016

The "New World Order" crowd has deliberately brought all of this on to try to force us into a one world government under the GOD hating UN! Check out "THE NEW AMERICAN" on line.

Market Timer November 19, 2016

If there is a sovereign debt crisis the US Stock market will get demolished just like it did in 2008-2009 only much worse. The Dow will go below 6K and to say that the stock market will go up with global unrest is absolutely absurd.

Steve November 23, 2016

Now you all said if we voted Trump it wouldn't be hell like Larry said here and he wouldn't hire these old time big shots, and he would fix the this economy right away!