“While the Dow Jones Industrial Average closed at an all-time high Tuesday, at 14,253.77, Charles Nenner, founder and head of research at the Charles Nenner Research Center, says the Dow will plunge to 5,000 by 2017 or 2018.
“We’re in an inflationary period and it’s very difficult to make money,” he told CNBC. “I still have a target of 5,000 for the Dow that we should reach in 2017 or 2018, and then we’ll get a huge bull market so it’s best just to go to sleep with your money until then.”
Instead of wondering how much they can make, investors should be asking, “How much can I lose?”
Nenner predicts a “catastrophe” not only for equities, but for bonds and the pound as well. He warned that there were hardly “any bright spots” in asset markets, until 2018.
His description of the U.K. currency was as of one of the worst performers of 2013 as it dropped below $1.50 on March 1, with the slump expected to continue into the summer.
“We’ve hit $1.50, and if we get close to $1.49, then we’ll go to $1.44, and if we get to that point before July, it could go even lower,” he said. “Austerity is not going to work in Britain.”
He added that even if the Bank of England introduces further quantitative easing this week, it would not support the currency.
Nenner also said that European stocks would fall this year. “You should take chips off the table. … The [market] insiders were buying [in 2012] and now the insiders are selling.”
Gold also doesn’t escape Nenner’s scrutiny.
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