Developer's Interview with Welles Wilder
From the February/March 1999 Issue of Futures Truth Magazine

NAME: Welles Wilder
AGE: 63
EDUCATION: Bachelor of Science in Mechanical Engineering
CURRENT POSITION: Director of the Delta Society
FAVORITE BOOK: The Bible

How did you get into the futures business?

After a ten year career in mechanical engineering, real estate and land development, I sold my interest in over a thousand apartments and various other real estate projects and began to pursue other areas of interest. I read a book titled Silver Profits in the Seventies, by Jerome Smith. Since Real Estate is a highly leveraged situation, I looked for a way to buy silver in a highly leveraged situation; this led me to the commodity futures markets.

"I made a lot of money in silver but lost most of it in learning to trade other commodities. This led to about five years of reading, and researching everything I could get my hands on relating to futures trading using mathematical models. In 1978 I published the results of these studies in New Concepts in Technical Trading Systems. My life has not been the same since."

What do you think about Y2K and the chances of disaster?

"At first I thought it was just a bump in the road causing a lot of hype. However, because it presented such enormous possibilities, I began to study it in depth. (Some of my friends call me 'Bulldog' because when I latch onto a concept, I don't let it go until I have exhausted virtually all the potential it contains). "In mid 1996, not much had been published on the subject (of Y2K), so the main area for research was the Internet, which came along just in time. I always enjoy research, because it involves sifting through opinions and latching onto the parts that can be proved or, in many cases, the items that cannot be disproved. The more I studied, the more non-disprovable information I gathered, and the more concerned I became.

"I believe most of your readers are most interested in the financial repercussions of Y2K, so I will concentrate on that arena: "The greatest financial party of the century is almost over. Banks and investors have become drunk with their huge profits and have devised more and ingenious ways to monetarize debt and then leverage it by means of derivatives. "The fractional reserve banking system now has, on average, $1.32 to dispense to depositors for each $100 in deposits. The stock market is now more 'out of value' than it was in 1929. Bankers see no place for gold in the monetary system; noone remembers or even considers deflation. "Y2K will be the catalyst that brings this house of cards crashing down. It will happen this year in 1999. It started in Asia, and the dominoes are falling. Russia has defaulted. South America, Japan, Mexico, China are all having big problems. Savvy investors are using this last market up-move to get out. "I believe that by mid summer to late summer the perception of the implications of Y2K will start bank runs throughout the world and in the United States. If the U.S. stock market has not already started to plummet, this will bring it about. I believe it will make 1929 look like a walk in the park. I believe 1999 will be the beginning of sorrows."

Where are the best financial opportunities now?

"In light of the above, there are basically two avenues. One is to buy put options on the stock market indexes. The other is to buy gold and silver call options. I prefer the latter because they are cheaper, and I believe they will provide more return on investment.

Also, when the bank runs start and the government imposes restrictions on withdrawals, what will the average guy write a check (on) in order to (acquire goods) -- it will be on the only things that have always had intrinsic value, gold and silver. "It would only take a small fraction of these 'average guys' to run the price of gold and silver to unheard of levels. Are the bankers still going to think of gold and silver as a barbaric relic and continue to sell their gold? No. They will suddenly realize they have pushed the envelope too far and that the confidence in the reserve system has finally been broken. It will be a new ball game with new rules: 'He who has the gold makes the rules.' The bankers will be first in line at the gold window to try to protect their own wealth. I believe this will happen in the late summer or fall of 1999.

"I recommend buying the December 1999 390 gold call options; currently they are under $200 apiece. If gold goes as high as it has been in the past, each call option will be worth $40,000. Regarding silver, I recommend buying the December 1999 silver call options at a strike price of $8. These are currently available for around $400 each. (call prices as of late January).

You can see the rest of this interview in the February/March 1999 backissue of Futures Truth Magazine. Order your copy today!