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CEO Predicts Market Armageddon: Dow To 5,000
Posted By admin On May 13, 2010 @ 9:50 am In Featured Stories,News In Focus,Paul Watson Articles | Comments Disabled
Hefty says real estate collapse in China before end of 2010 will send shockwaves through global economy
Paul Joseph Watson
Prison Planet.com 
Thursday, May 13, 2010
Cornerstone Wealth Management CEO David Hefty agrees with a growing number of other financial experts that a real estate collapse in China before the end of the year will send shockwaves through the global economy, leading to a stock market collapse which will send the Dow into free fall below the 5,000 level.
Although Hefty said that the Dow would push higher beyond 12,000 by July, the fact that the market is “still in complete denial of what’s going on around the world and here at home” would soon lead to a dramatic reversal, Hefty told skeptical CNBC hosts.
Hefty said that when the market turns it will go into a “complete free fall” mirroring the collapse in oil prices in 2008 and could push the Dow below 5,000 by the end of this year – which would represent a decline of around 60 per cent.
The catalyst for such a plunge according to Hefty will be a combination of lower than expected GDP results, a surge in the number of foreclosures in the U.S., as well as a financial collapse in China.
“You can’t build cities for millions of people and have them half full – there’s problems with that, and not only are they going to be facing this real estate crash themselves but they’re facing inflation, so they’re going to have to slow their economy down in the midst of a real estate crash, and I didn’t even mention Europe,” said Hefty.
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Many other financial experts are predicting problems in China  with stagflation and a property market collapse before the end of 2010, which would send shudders through the global economy.
Marc Faber told Bloomberg that China would collapse in 9-12 months, a sentiment shared by hedge fund manager Jim Chanos and Harvard University’s Kenneth Rogoff.
Nouriel Roubini has also warned that the Chinese economy faces the risk of “significant slowdown”.
With real estate set to crash as a result of government measures to reign in out of control prices, the amount of bad loans that were handed out like confetti during the boom will be exposed, leading to the need to recapitalize Chinese banks, which in turn will eat up reserves and leave the country facing a mountain of debt.
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URLs in this post:
 Prison Planet.com: http://www.prisonplanet.com../
 Image: http://infowars-shop.stores.yahoo.net/inemnewwoord.html
 Many other financial experts are predicting problems in China: http://georgewashington2.blogspot.com/2010/05/is-china-bubble-starting-to-burst.html
 “The Next Tsunami to Hit will be the Commercial Real Estate Market”: http://www.prisonplanet.com/%e2%80%9cthe-next-tsunami-to-hit-will-be-the-commercial-real-estate-market%e2%80%9d.html
 Gerald Celente Predicts Economic Armageddon by 2012: http://www.prisonplanet.com/gerald-celente-predicts-economic-armageddon-by-2012.html
 After Chinese Rate Hike, Faber Warns Of Severe Market Crash In 9-12 Months: http://www.prisonplanet.com/after-chinese-rate-hike-faber-warns-of-severe-market-crash-in-9-12-months.html
 Central Bank Hid Housing Market Crash Forecast: http://www.prisonplanet.com/central-bank-hid-housing-market-crash-forecast.html
 Housing Market Being Pounded By New Wave of Foreclosures: http://www.prisonplanet.com/housing-market-being-pounded-by-new-wave-of-foreclosures.html
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