A CIA analyst known for his dire economic predictions is speaking up again, warning that the next Great Depression may be right around the corner. Jim Rickards, a "financial threat and asymmetric warfare adviser" for the CIA, tells Money Morning that Americans should be preparing for a $100 trillion financial catastrophe. "Everybody knows we have a dangerous level of debt," he says. "Everybody knows the Fed has recklessly printed trillions of dollars. ... But all signs are now flashing bright red that our chickens are about to come home to roost." Another reason for gloom: According to Rickards, the so-called Misery Index maintained by the Federal Reserve contains far worse data than most people believe.
The Misery Index adds the true unemployment rate with the true inflation rate, but Rickards contends that the Fed has altered the index's calculations in order to hide the truth—that "the Misery Index has reached more dangerous levels than we saw prior to the Great Depression," he says. "This is a signal of a complex system that's about to collapse." His prediction? A "70% stock market crash" followed by a 25-year depression, possibly sparked by a "major credit collapse" in China, he tells Reuters. His advice? Invest in "hard assets" like railroads, coal, wheat, or gold. Again, he's not known for mild predictions: In a recent monthly newsletter, Rickards claimed that by 2020, all G-20 gold will be hidden under a Swiss mountain to keep it away from the world's economic system, Goldseek reports. (Read more economy stories.)