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Mix-Ansicht- and now in English.............. - Emerald, 05.12.2003, 16:04
and now in English..............
-->Outlook on the year 2004
Advancing toward an Increasingly Uncertain Future.
Coming straight to the point we must emphasize that our outlook on the year 2004 is based on and conditioned by the unstable situation prevailing during the current year.
The disastrous interlinkage characterizing today's international politics, which has mainly been brought about by the U.S., sweeps all of us along toward an extremely unstable future. The failure of the Iraq campaign predicted by many Cassandras has evidenced in every detail, during the last six months, how imperial posturing can effectively turn into a boomerang,
On the one hand, the never-ending armed conflicts in the Middle East burden both directly involved persons and outside parties with an almost unbearable strain, while on the other hand further worries are added by an irresponsible accumulation of debts calling to mind the thirties of the past century. A conspicuous difference with respect to those days consists in figures having to be multiplied a hundredfold or even a thousandfold in order to attain the present-day level.
Within such a perspective, the U.S. President now in office is bent on getting re-elected in November 2004. Invoking as his mission worldwide anti-terror campaigns coupled with often questionable accompanying measures, he is already replenishing a year in advance his electioneering campaign chest with contributions from beneficiaries of tax reductions, of the war endeavours and of shortages in raw materials, such as the financial and armaments industries as well as the entire oil business.
Against the background of such rather corrupt dealings, hardly a week elapses without uncovering and indicting criminal acts, which have been standard procedure during many years in the U.S. financial community. It is both curious and noteworthy that these misdeeds are in most cases"buried" and filed away by payment of huge amounts of hush money. This invites the interpretation that any imitations of such offences may in future again be settled simply by paying pecuniary penalties.
All of these events happening in rapid succession are seriously unnerving the whole world. It is generally realized that therapies aiming at remedying the ailments of the world's economy do scarcely promise any factual results: outsourcing of manufacturing and service industries to newly industrializing"threshold countries", revaluation and devaluation of currencies, rather obsolete protectionist measures such as protective duties and tariffs, as well as tax cuts - all of them produce at best short-term effects, if any.
The flood of Indian and Chinese low-cost products of high quality standard rapidly inundating global markets might deal the death-blow to many Western corporations unable to meet the challenge. This reversed flow of goods and services will cause incalculable damages to governmental budgets, tax revenues and above all to the"Western-educated" financial community.
While in the year 2003 we could now and then distinguish - not least due to the highly contestable conduct of the Iraq war - symptoms of economic recovery, this silver lining might soon turn into a downswing. At any rate, we do not see any reasons to hold on to stocks, while we feel it is rather advisable to face the future provided with plenty of liquid funds and by investing in gold. It is certainly too early to warn about inflation, but on the other hand we feel that an increasing number of indicators point to the likelihood of price increases in the U.S. as a consequence of the extremely weak dollar.
In times of general insecurity with a market exposed daily to drastic changes, we recommend to keep a portfolio free of debts with high priority given to investments in first-rate mining stocks, securities connected with raw materials as well as sufficient liquid funds. With its dollar-denominated value having increased since mid-2000, gold henceforward does not only serve as a safety measure, but also to ensure stability of value in times of an entirely unpredictable future.
The year 2004 is likely to confront us with far more difficulties than the year of the intermediate recovery now almost behind us.
We heartily wish all our readers the best possible prospects in all their undertakings.
15 December 2003
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