Detailed Reasons for these Predictions
In 2002, gold bullion traded under $300.00 an ounce. This was when Michael Lombardi through his Profit Confidential newsletter dated December 13, 2002, advised his readers to buy gold-related investments. At that time he had been pushing gold bullion and gold shares since a year; with his personal gold shares investments commencing from January 2002.
In 2006, Michael feared that the U.S. housing market would plunge and began issuing warnings about the crisis that would befall this sector right from the time when its boom was at its peak. On August 2, 2006, Michael Lombardi expressed his concern that the housing market predicament would greatly impact the economy. He was also anxious about the possibility that the U.S. could be headed for its first annual decline in home prices on record, adjusted for inflation and that it could spell disaster for the U.S. economy.
Michael Lombardi was also one of the first to predict that the U.S. economy would be in a recession by late 2007. On March 22, 2007 he informed that he had been writing about sub-prime lenders and how their demise would harm the U.S. housing market, the economy, and the stock market. He also warned that the U.S. would have to face a challenging situation as a result of the housing market and the sub-prime business falling apart. Also, the easy availability of money for borrowers was the reason for the housing boom that saw its peak in the year 2005 and the consequential ill-effects of the same were still to strike!
In direct contrast to the above, former Federal Reserve Chairman Alan Greenspan was quoted as saying that the U.S market had seen the last of its worst days and that the situation could not in any way harm the economy.Michael Lombardi also foresaw the stock market crash in 2008. On November 29, 2007, Michael Lombardi warned that the Dow Jones Industrial Average, the S&P 500 and the other major stock market indices finished a day earlier with the best two-day showing since the year 2002 and that the market rally of the former two days was indicative of a classic stock market bear trap. He also opined that with further contraction in the economy, the year 2008 would be a testing time for America.