An investor briefing from the desk of Olivier Garret, CEO of Casey Research
Washington's Efforts to
We're serious, and so is the situation.
Take these six simple steps NOW
to protect yourself (and profit) as
the economy falls apart around you.
Dear Friend and Reader,
It's become abundantly clear: America's debt and deficit spending situation is completely unsustainable and will be disastrous for the economy.
Right now Washington reminds me of Wile E. Coyote spinning his legs after he's run off the cliff. They can debate the debt ceiling, double up their stimulus efforts, and shout and wave their arms all they want – but there's only air beneath them... and a hard landing waiting far below.
They ran us off the cliff a long time ago – and we're about to get a serious lesson in gravity.
We do, however, still have a chance to cushion ourselves before we hit bottom.
Take action now – including the six steps I recommend below – and you can begin to protect yourself from the unfolding crisis. Even better, you'll likely collect substantial profits as a result.
However, if you choose to minimize or even ignore the problem like Washington and the mainstream media, you will pay dearly. Your savings, your investments, your life's work – they'll all be in jeopardy as this debt crisis goes into free-fall. And it'll just get worse as Washington continues to do all the wrong things in response.
I'll give you six specific steps you can take to protect your financial well-being in a moment. But first, a quick reminder of why it's critical to your financial well-being to be taking action now...
Collapsing Confidence in US Debt
China's People's Daily
China trimmed holdings of US debt again... Concerns have arisen that the United States may default on its debt."
Central banks have good reason to buy gold. The dollar is no longer a safe asset for backing currencies. Treasuries are not a sound investment."
PIMCO started betting against US government-related debt in April... on concerns about the US fiscal outlook."
[Jim] Rogers says the Treasuries market is one of the few bubbles that he sees in the world today."
Take Their Money and Run
It's clear – the investor confidence that kept the US at the top of the world's economic pyramid is collapsing.
Months ago, central banks in China, Russia, Mexico, and beyond started systematically liquidating their investments in the dollar and US Treasuries.
Big-name investors have been selling, too – most notably PIMCO's Bill Gross, who runs the world's largest bond investment fund. And Jim Rogers, co-founder of the Quantum Fund with George Soros, was recently featured on CNBC for his short position in Treasuries.
These are among the smartest investors in the world, and they didn't wait for the S&P downgrade of US debt to know it's time to get out. I'm watching what they're doing... and I think you should be paying attention, too.
Of course, Washington is chiming in at the eleventh hour and finally admitting this collapsing confidence in the dollar and Treasuries could spell disaster – not only for the stock and bond markets, but perhaps for life as we know it.
From US Treasury Secretary Tim Geithner:
If we leave our debt problems unaddressed, those who lend us the resources to fund our past and future commitments will eventually demand higher interest rates... Higher borrowing costs for American households and businesses will discourage future private investment, lowering our capital stock, reducing our economic growth and depressing our standard of living.
Geithner is a bona fide expert in sweeping Washington's financial mess under the rug. If even he's admitting the system is broken, we must be in trouble.
But rest assured...
Washington Will Do Everything
They Can to "Save America"
But the truth... and what they want you to believe... are two different things.
What will Washington do to save us from this debt crisis? (And by "us" they mean themselves and their friends on Wall Street.) What impact will it have on us as individuals and the economy as a whole? Let's look at the options...
Option #1: Overt Default. If the US defaults on its debt, it would be catastrophic for the Treasury market. And not only would bondholders get fleeced, the market for US dollars could easily dry up just about overnight. So anyone holding dollars when it happened would be in severe financial pain.
The bad news is this is probably the best long-term solution to our debt problem. In fact, it may be inevitable. The good news (for bond holders, at least) is that Washington knows an overt default – simply not paying obligations – is political suicide. So they've proven before and they'll prove again that they're going to go to great lengths to prevent it.
Option #2: Austerity plus higher taxes. Another real solution to our debt problem is to own up to it and pay it down. But they have to take it more seriously than they have been. This means slashing (not just cutting) military spending, Social Security, Medicare and Medicaid, and tons of other government entitlements.
Yet there's just no way Washington's going to reduce spending in any way that would really matter. After all, you can't win the election by killing Social Security. But some cuts plus higher taxes for the "rich" are already coming down the pike... which means if you either rely on government help or have or make any money to speak of, you're a target.
Option #3: Rampant inflation. This is both the easiest and hardest way to deal with a debt problem. You see, we have the advantage that all our debts are denominated in US dollars. And we control the supply of US dollars. So we can print our way out of debt. Easy, right?
Of course, there are problems with this. Monetary inflation – printing money – inevitably leads to price inflation. This makes inflation an invisible tax that hurts everybody... especially savers. Every dollar you own is losing purchasing power by the day. It's the reason a loaf of bread or a gallon of milk costs many multiples of what they used to. The bread and milk aren't gaining value: your money is losing it. But the printing press is like a drug for Washington. The more they use it, the more they want it. Hence TARP, TALF, QE1, and QE2. All were spun politically as "Saving America" from crisis – but really they're just a guise for inflating away the debt. Sure, they stimulate the markets while they last, but long term they're leading us down a path to destruction.
The way we see it, these are the only options Washington has on the table... every one guaranteed to eat away at your wealth – until either the national debt or your money are gone.
And they won't stop at just one option.
You can only inflate so fast without creating another Weimar Germany or Zimbabwe – where money's no longer worth the paper it's printed on, and even billionaires are beggars.
So while they run the printing presses, Washington will also pass one tax after another to squeeze every red cent possible out of us productive members of society – for as long as we still have anything to our names. And when that's not working fast enough, they'll look at strategic defaults on their debt – foreign investors are likely to lose out on interest payments first. But when that's not enough, anything and everything will be on the table.
Of course, none of them have any real answer that will bring our economy back to life. The left's solution of higher spending can only be done with more borrowing and more inflation. The right's austerity measures would pull the rug from under the economy and likely crash the investment markets.
It's two sides of the same coin – and no matter how it lands, we all suffer.
The Exact Opposite of the Right Thing
As my friend and colleague Doug Casey likes to say, Washington not only does the wrong thing, they do the exact opposite of the right thing. This just makes things worse. And the worse things get, the more havoc Washington will wreak.
Take The Fed's recent decision to hold press conferences, claiming a sudden desire to become "transparent." All these press conferences do is set the stage for Fed Chairman Bernanke's overt market manipulations. Who needs stimulus when all that's required is for Big Ben to open his mouth?
Take, for example, one of Bernanke's recent appearances before Congress:
On the first day of his two-day testimony, Ben Bernanke reassured members of Congress the Fed was prepared to take decisive action to stimulate the economy. The market spiked within minutes on the news.
In the next day's testimony, Bernanke's position turned 180 degrees as he said, "We're not prepared at this point to take further action." Accordingly, the market dropped sharply.
This is flagrant manipulation. And while it may save Wall Street's quarterly profits, it doesn't live up to their PR and campaign promises that they're going to turn America's economy around for the benefit of you and me.
- Our jobs picture is still decidedly negative
- Home prices have fallen more than they did in the Great Depression
- And inflation has driven prices up, even while Washington tells us it's under control
Yet, even though their policies are a major cause of all these problems, it's going to be more of the same from Washington as they claim to try to fix the mess.
And that's why what we've called The American Debt Crisis will be bigger than we can imagine... worse than we can imagine... and why it's so important to protect yourself now.
How to Protect Yourself from
The American Debt Crisis
If there's any good news about The American Debt Crisis , it's that there are steps you can take now to position yourself to avoid the worst – including both investments and actions you can take personally. Below, I'll explain those steps – and even show you a few opportunities to collect substantial profits as the crisis unfolds.
Over the last two years I have been able to take control of my future financially, and feel more confident and more ready to tackle the undoubted challenges that lie ahead thanks to access to your research and analysis. I look forward to a fulfilling and prosperous future for which Casey Research is at least partly responsible. Many thanks and keep up the good work."
– Andy H.
Thanks to you and the team for helping me (a technically inexperienced investor) find the confidence necessary to bag a 75% overall return in five months, with exponentially bigger gains likely to follow."
– Karl R.
But before we get to the six steps to protect yourself and profit, I should tell you about our unique methods of research and analysis.
Casey Research's approach is based on a big-picture view. From our most niche-specific alert services to The Casey Report, our monthly big-picture investing newsletter, every decision is influenced heavily by cultural, political, and economic forces at play.
We look at the primary players in the market – by cash flow, political power, and a general ability to move the market. (And of course, nobody has a more powerful market impact than the US government.)
We watch these market makers like a hawk. Because the market reacts to their every move, we want to be able to anticipate what their next move will be. And there's one thing you need to know if you want to predict what they'll do next: They'll protect themselves at all costs. Investing accordingly has given us handsome returns many times before and will continue to do so for ourselves and our readers.
Another thing that makes Casey Research unique is just how much time we spend combing through economic data looking for the next big economic trends. We look behind the data to find the underlying trends – that's how we get readers in early for maximum gains.
Of course, there are all manner of "black swan" events that even we can't predict with certainty. But if you know what to look for you can often see pressure building for something big to happen.
For example, economic downturns announce themselves many months in advance when you know that spiking oil prices have a high correlation with recessions... Or, if you take a look at historical data sets, you'll quickly see that there's a strong link between big drops in housing sales (like the 8% drop in September 2007), consumer spending, and GDP.
History doesn't necessarily repeat itself, but it often rhymes. In any emerging crisis, it's usually those investors who insist that "this time it's different" who get hurt the most. That's how we've been able to accurately predict many, many times before how a current trend will play out.
So with that in mind, these are the investments we like best for this stage of the crisis...
This Investment Will Pay Off
for Years to Come
A core tenet of crisis investing is that "stuff" maintains real value while everything else goes down. What do I mean by stuff? Commodities, precious metals, and prime real estate bought on the cheap, for example... These have real value independent of the currency in which their price is denominated.
It doesn't matter whether you denominate them in dollars, euro, rubles, renminbi, or seashells... a bushel of corn, a tank of gas, and an acre of farmland all maintain real and usable value that doesn't depend on the currency you use to buy it. But even then, some "stuff" investments pay off better than others in crisis.
Looking back in history, one such investment has made more tycoons than any other, in both good times and bad.
Since the Industrial Revolution, the world has run on oil. Our modern world was built on "black gold," and those who discovered it and brought it to market struck it rich. Yet this trend is far from over. Even as the West gets "greener," China, India, and other growing markets are consuming oil at a faster pace than ever. China's oil consumption, for example, more than doubled between 1998 and 2009 – from 4,105 barrels per day to more than 8,300. All of this while worldwide production has been stagnant for much of the last decade.
Despite Al Gore's arm-waving, the world is still addicted to oil – and there's not enough to go around.
Increasing demand and constrained supply will lead to higher prices, even without inflation and political instability in oil-producing nations also pushing prices up.
In The Casey Report portfolio, we have an oil-and energy-related fund we recommend because:
- It has among the lowest expense ratio of funds with similar holdings
- It gives you exposure to high-quality oil producers with more upside than oil itself
- And it gives you critical diversification in an industry constantly under fire from environmentalists and politicians (you saw what this did to BP)
Whether you choose our recommendation or find your own, putting at least one well-selected oil investment in your portfolio is a smart way to stay ahead of the crisis.
But oil is only part of the total energy picture.
Some of the best profits in energy in the next few years are likely to come from one of today's most overlooked forms of energy available: natural gas.
Natural gas is so overlooked because new technologies like hydraulic fracturing ("fracking") have opened up gas deposits in the United States that were previously hard or impossible to get to. The result: a supply glut of natural gas that led to the bargain-basement prices we see today.
While the current low prices are keeping many investors away, we see a buying opportunity. Natural gas is currently discounted by 75% compared to oil when measured by heat generation. Prices are bound to go up.
In fact, natural gas is so underpriced it could go up by 300% and still be on par with today's oil prices. This is the type of market anomaly where profits are less a matter of "how much," but rather "when."
This opportunity is much like uranium in October 1998, when Doug Casey was the only analyst with a contrarian enough bent to cover it. At the time, "the other yellow metal" was selling at just $9.50 per pound – a price Doug recognized was bound to go up due to a number of converging factors. Over the next nine years it took a trajectory to the moon, eventually topping out at $136 per pound in 2007. Along the way, Doug recommended a number of uranium stocks that handed readers exceptionally large gains, including International Uranium (now Denison Mines) and Paladin Resources, which both gained more than 2,000%.
One rather low-risk way to get strong upside exposure to what we see as an inevitable upshot in natural gas prices is through utility companies. They're relatively safe plays because utility companies have strong cash flow – even during a crisis, customers will pay to keep the heat and lights on. Utilities often pay strong dividends. And there are additional opportunities to profit above and beyond price increases in natural gas itself.
Our favorite is a large, financially strong natural gas utility:
- It has a sizeable customer base spread across the mid-Atlantic and Southeast
- Even with low natural gas prices, it maintains high profit margins and a healthy dividend greater than 5%
- And it's undergoing a promising merger to nearly double its customer base plus acquire an additional profit center that also gives it a power position in the natural gas storage industry
This company will continue to be profitable whether or not the price of natural gas goes up in the short term. In fact, they have profit strategies in place whether gas goes up, down, or sideways.
Again, like our oil-market pick, this play won't make you rich overnight – but it has strong upside potential with little risk. And it's a "stuff" play to protect your portfolio in the crisis, with additional profit potential based on smart business practices. In The American Debt Crisis, this is exactly the type of investment you'll want in your portfolio to protect yourself... and collect solid profits, too.
Gold for Protection and Profit
Ben Bernanke says, "Gold is not money." Yet for thousands of years cultures across the globe have used gold as a means of exchange and store of wealth. Not one government-backed currency has endured like gold.
Doug Casey often refers back to Aristotle's criteria for sound money as to why gold maintains this status. In Doug's words:
- It should be durable (which is why, say, wheat isn't a good money – it rots)
- It should be divisible (which is why artwork isn't a good money – you can't cut up the Mona Lisa for change)
- It should be convenient (which is why lead isn't a good money – it just takes too much to be of value)
- It should be consistent (which is one reason why land can't be money – each piece is different)
- And it should have value in itself (which is why paper money leads to trouble)
You don't buy gold to get rich. You buy it because it purchases the same amount of stuff now as it did 100 years ago... while the purchasing power of the dollar has fallen by 98%.
You buy gold because Bernanke and friends have proven they'll do anything to keep interest rates low and "fight off" the debt crisis – even if it means complete debasement of the dollar.
In 1935, when an ounce of gold was worth $35, you could buy:
- A high-quality tailored suit for $19.75
– or 0.56 ounces of gold
- A family car for $500
– or 14.3 ounces of gold
- A house for $7,150
– or 204.2 ounces of gold
With prices around $1,800 per ounce as of this writting, let's see what that same gold would buy you today:
- 0.56 ounces of gold is now worth $1,008 – about the price of a Signature Gold suit from JoS. A. Bank
- 14.3 ounces is worth $25,740
– enough to drive home a Toyota Camry
- And 204.2 ounces is now worth $367,560
– which gets you an above-average home in all but the most expensive areas of the country
The purchasing power of the dollar has dropped like a stone – but gold has endured and still buys you today about what it always has.
Of course, you can profit from gold, too. And that's why we recommend a three-pronged approach to investing in gold in this stage of The American Debt Crisis:
Invest in Gold, Part 1: Get Physical
Putting a portion of your savings in physical gold protects you from the song and dance of negative real interest rates, as the Fed devalues the dollar to help Washington manage its debt. Store your gold somewhere safe, and history has proven it should buy about as much when you take it out of storage as it did when you put it in – no matter what happens to the dollar between now and then.
For physical gold, we recommend most investors start with the most popular forms available: Eagles, Maple Leafs, and similarly mainstream bullion coins. They have established market value, and because they're so widely known they should be easiest to sell if you ever need to do so.
Invest in Gold, Part 2: Pad Your Portfolio
In The Casey Report, we follow a select gold fund that allows you to buy gold from within your IRA and other retirement or investment accounts. This is quick and easy, so you can get invested in gold right away, to begin padding your portfolio against inflation. This type of fund shouldn't be your only gold strategy, mind you – because there are many benefits to having the metal in hand when you need it. But it can be an important part of your gold holdings.
This investment has had a lot of upside recently – gold's been on a ten-year winning streak that Casey readers have profited from tremendously. But that's not the only reason to hold it in your portfolio. Think of a gold fund as an alternative place to stash your cash between investments – when you can't stay ahead of inflation by holding cash in money market funds.
Invest in Gold, Part 3: Profit Opportunities
It's one thing to invest in the metal itself – either directly by buying physical gold or by proxy through the gold funds. But the current gold bull market will also make a lot of people far wealthier by the time it's done. The key is to invest in gold mining and exploration companies. Put very simply, if a company is able to produce gold at $400 per ounce which many do – and the price of gold goes from $800 to $1,600 or $2,600 per ounce, its profit goes through the roof. Share prices tend to follow in kind.
For investors who want to invest in this trend without maintaining an active portfolio of gold mining and exploration companies, there are a number of ETFs available. But even in a bull market there are downside risks, especially in smaller companies without active projects. Whether via direct investment or ETFs, you only want to invest in high-quality gold companies – and we have a favorite fund that will help you do just that.
But is it still a good time to get into gold?
We know gold is a popular investment today. Many analysts are recommending it because, well, it's on a ten-year winning streak. When Doug was recommending it in the late 1990s, it was for the exact opposite reason – the price had simply been too low for too long.
Sure, today's popularity makes us cautious... but no matter how we cut the deck, the big picture still points us strongly toward gold. The US continues to debase its currency, as does just about every other government on the planet. They have to, in order to pay for decades of debt and overpromising. Their only way out of years of mismanagement is to destroy the currency in which debts are denominated.
As currencies go down, the price of "stuff" goes up. And gold is the most enduring "stuff" to hold for folks who want to maintain their wealth. So even with today's record-high prices of gold, we still see it going considerably higher as paper currencies continue their downward spiral.
Besides, gold's recent run has not generated anywhere near the mania you see at the end of most bubbles. Around 2005, everybody and their brother was flipping houses on the weekend to get in on the record-high prices. We know what came of that. Until you can't open Newsweek or turn on Good Morning America without hearing about how everyone must buy gold now – and until you see pawn shops with signs that say "We Sell Gold" instead of "We Buy Gold" – we're not in a mania... and gold still has room to run.
And as long as The American Debt Crisis endures, this three-pronged approach to investing in gold should be a critical part of your saving and investing strategy... both for the protection it provides against bad monetary policies, and for the profit potential it gives you thanks to gold's ongoing historic bull market. Once you subscribe to The Casey Report, you'll get instant access to our portfolio and the gold recommendations it includes.
The Only Way to Make Money in Bonds for the Next Few Years
As I mentioned above, some of the biggest players in the US Treasury bond market have been selling for months – some even building substantial short positions in Treasuries.
Yes, it's still the largest, most liquid investment market in the world... and still holds sway in the establishment as the "safe haven" investment.
But here's the thing – what Bill Gross from PIMCO and others like him realized months ago...
Even if the US government doesn't overtly default on these debt obligations, they're still playing a dirty game of "soft" default. As long as their printing presses keep inflating away the value of the dollar faster than you can make money with the interest rates offered on Treasuries...
Bonds are the safest way to lose 1%, 2%, 3% or more of your purchasing power every year.
These negative real interest rates can wreak havoc on your retirement plans. Let's say, for example, you retire today at 65 and buy 20-year bonds, hoping to maintain purchasing power until you're 85. Losing 3% of your purchasing power every year doesn't seem like that much until you calculate it out over the life of the bond – and realize that by the time the bond hits maturity it can only buy you 56% of what it could have bought you the day you purchased the bond.
This simply can't go on for long.
Interest rates are at 50-year lows. Using the last crisis as an excuse, Washington has been able to force the cost of its new debt down to simply unsustainable levels:
Yes, the Fed has used quantitative easing (QE) to act as a "buyer of last resort" to ensure that even at these low rates the Treasuries are scooped up every time they're offered. But this stimulus just drives real and expected price inflation. Which means all the other buyers in the market will want higher interest on their investments – especially as Washington struggles to keep up in the debt crisis. And even though the Fed has been able to control short-term rates with QE, long-term rates are far less controllable and could rise quickly.
If you're buying bonds at today's low rates, this is bad for you, because as rates go up, the value of your bonds go down. So you lose two ways – first, from negative real interest rates; and second, from the depreciating value of your investment as market conditions change.
Short-term upticks may look good, but historically speaking today's bond market is headed for a major swing in the other direction.
Which leads to "the only way to make money in bonds in the next few years."
Put simply: You don't want to bet on bonds, you want to bet against them. But shorting bonds can become expensive, because unlike shorting stocks you are required to make the interest payments on the bond for as long as you hold the short position.
We've uncovered a couple of unique investment vehicles that allow you to short bonds while avoiding interest rate payments... and take advantage of the large upside we see in the coming months and years as interest rates swing back upwards toward a more historically "normal" level (with the added benefit that if interest rates take off due to inflation like they did in the 1970s, you'll be looking at even bigger gains).
Here's the expected performance of our two favorite picks as interest rates rise:
|Potential Net Gains - Inverse Interest Rate Instruments|
|Ticker:||For subscribers only||For subscribers only|
|Tracks:||100% Inverse 20-30Y Note||125% Inverse 30Y Note|
|Risk/Reward:||Medium Risk/Reward||High Risk/Reward|
|Interest Rate Rise:||Potential Net Gains||Potential Net Gains|
We've already seen it throughout Europe: When a sovereign debt crisis hits, there's little the borrower can do to control interest rates. Lenders simply want more for their money. Before The American Debt Crisis is over, we expect to see much higher rates. And this is simply one way to shield yourself and profit.
Become a Global Investor
Without Leaving the US
If you want to protect yourself and your money from the coming crisis, you need to "get one foot over the border." For some, that includes offshore trusts and other similar investment vehicles. For others, that includes purchasing property overseas, such as at Doug Casey's La Estancia de Cafayate in Salta, Argentina. And it can even mean getting citizenship in multiple countries.
Most people's first reaction is, "But that's for people who have a lot more money than me!" And that's understandable – although it may be much easier and more affordable than you might expect.
With just a few thousand dollars to invest you can start to get one foot over the border financially – to insulate yourself from the US market's volatility in the crisis. And you can do it from within your IRA and other retirement or investment accounts.
How? Simple. You can get quick global diversification by buying one of hundreds of funds traded openly on the New York Stock Exchange. These funds typically follow an index of companies in one or more countries, and often have a specific focus such as industry or company size.
For example, a single investment in the BKF ETF gives you exposure across the BRIC countries – Brazil, Russia, India, and China – with investments in a number of large companies in each country, representing a number of different sectors. Or with SCJ you can invest just in Japanese small-cap stocks.
Of course, without thorough research into the countries, economies, political situations, and companies in question, this can be tricky. After all, most of the world's economy is tied in directly to the US economy. In The American Debt Crisis, much of the world will suffer.
That's why we prefer resource-rich countries, insulated to some degree from the US economy, that also have low political risk.
For example, our first global diversification recommendation:
- Outperformed the S&P 500 by many multiples since the 2008 crash, showing it moves independent of the US markets
- Has tight monetary policy, a growing economy, and a strong pro-business climate
- And is rich in resources – the "stuff" investments that perform well in crisis
And our second:
- Has high labor immigration, enabling fast economic growth without fueling price and wage pressures (an anomaly among similar mature economies)
- Gives you exposure to a country that runs budget surpluses instead of deficits
- And is also resource rich, with a heavy concentration in energy
This type of "one foot over the border" investment is easy to make, and is a no-brainer for investors looking to pad their portfolio against the impact The American Debt Crisis will have on US investment markets.
The Anti-Bernanke Savings Strategy
Keeping your savings in US dollars is a losing proposition. Ben Bernanke and the folks at the Fed are more interested in "saving" the American economy with ongoing stimulus than saving the dollar. This means traditional savings vehicles are toast when it comes to keeping you ahead of inflation.
But what options do savers in the US have?
Most people simply aren't aware that there's a US-based bank named EverBank that allows you to diversify your savings into foreign currencies, starting with accounts as small as $2,500. Depending on your preference and account size, you can open a deposit account, CD, or basket CD in well over a dozen different currencies. Some even pay much higher interest rates than accounts in US dollars.
One important consideration when saving in foreign currencies:
These foreign currency savings vehicles are subject to normal fluctuations in exchange rates. That's exactly what makes them so attractive if you pick the right currencies. If you're saving in a currency that gains against the dollar, when you convert your savings back you get more dollars. Of course it works the other way around, too. Yet it's worth noting that in heavy inflation the difference between suffering and staying financially comfortable can simply be moving some of your assets into another currency.
As I recommend this savings strategy, I also need to share that it's our firm belief that all fiat currencies are eventually headed to zero. Some, however, are headed there much more quickly than others.
So how do you pick which currencies to save in? We tend to look to resource economies, of course. But that's not enough. On a monthly basis we closely monitor central bank policy decisions out of a number of countries. Based on the strength of the economy overall and on their government's commitment to maintaining a strong currency, we choose our favorites.
In The Casey Report we're following two currencies we like best right now. Every month we keep readers posted on developments related to these currencies... and will also provide updates in the monthly issue should our recommended currencies change.
A brief note: Many people I speak with initially balk at putting their savings in foreign currencies. In 1913, before World War I, many Germans felt the same way. At that point, the German mark, the French franc, and the Italian lira were all worth about the same. Then the famed Weimar Republic hyperinflation happened. By the end of 1923 the exchange was one franc or lira per one trillion marks. The few Germans whose savings maintained value through that period were those who put at least some of their savings in currencies other than the mark.
Most people don't think we could ever see inflation in America anything like that of Weimar Germany. Yet this illustrates exactly why a savings vehicle like those offered through EverBank is so important to consider – especially when Bernanke and the Fed have shown such a willingness to prop up every market downturn with more inflationary monetary policies.
The Single Most Important Investment You Can Make Today
I've just given you five solid investments to help you through The American Debt Crisis, both personally and financially. And frankly, if you do nothing else today for your financial future, making these five investments will be a smart way to protect yourself and profit in the crisis.
But there's an even more important investment you can make today... to help you weather The American Debt Crisis, plus come out on the other side as a more successful investor and economic thinker.
of many newsletters
The Casey newsletters are hands-down the most valuable of many newsletters I've subscribed to since becoming aware of the precarious state of the US economy and dollar about two years ago. The stock picks are invaluable... and provide an invaluable insight that cuts through the noise of so much other information that I sift through on a daily basis. Great job and much appreciated."
– Russell W.
And that's investing in The Casey Report.
The Casey Report is not like most other financial newsletters and publications you may encounter. Of course, as I've said, The Casey Report is unique in its big-picture perspective on the economic and political climate, and insight into how they drive the investment market.
But that's just the beginning.
The Casey Report stands out in the world of financial publications in many other ways.
For one, you may think of financial newsletters as just stock picking services – that is, each issue picks a stock or two and tells you why to buy. While we think the "stock picking" model can be valuable, the Casey Research organization was created to do far more than provide simple stock picks.
Our goal is to provide thorough research, analysis, commentary, education, and insights to help you achieve personal freedom through financial freedom. And that takes far more than giving you a ticker symbol and a buy price.
And while each issue does have a "How to Invest" section with actionable investment recommendations, it only comes after two or three thorough articles (often as long as – and more thoroughly researched than – entire issues of other investment newsletters) giving you in-depth insight into the economy, political climate, and investment markets... plus specific how-to instruction that will help you become a better investor with every issue you read.
For example, just one recent issue of The Casey Report contained:
- A bird's-eye view of the current crisis, with an eerie comparison to hyperinflationary Weimar Germany, from Managing Editor David Galland
- Doug Casey sharing fundamental lessons on making and keeping your money... the same no-hype lessons that helped him build his multimillion-dollar wealth independently
- Senior Economist Terry Coxon on why the recent so-called recovery has been the slowest economic comeback in living memory, despite the fact that the economy has been given the biggest dose of fiscal and monetary stimulus ever administered in the US
- Chief Economist Bud Conrad on the fundamentals of the world energy market... and the developing "Second Cold War" – this time with China – over energy (plus what it means for investors)
- And an interview between Casey Research's Washington correspondent, Don Grove, and leading voice for free-market economics, Dr. Walter Williams of George Mason University in Virginia, on the legalized theft Washington is committing against Americans
Plus "The Data Farm," a monthly feature covering today's critical economic and market data with analysis on what future economic trends the data suggest.
... All in a single issue.
(With all this valuable content, you can see why each issue runs 50 pages or more!)
And here's the thing. Because we're not beholden to any advertisers, media, politicians, nor any other outside influences...
You'll find that each issue of The Casey Report pulls no punches. While the mainstream financial media may cover some of the same topics in covering the debt crisis, they end up sugarcoating the latest government figures or legislation to appease their advertisers, the politicians they've bought and paid for, or simply just to stick to the party line... or, quite often, they simply end up parroting what they've been told out of sheer ignorance.
Casey's editors find and tell the truth as they see it, without fear of reprisal.
Perhaps this dedication to truth is why they're also so accurate at forecasting future economic trends – because once they've found what's going on, it's one small step to see where it leads us...
Calling the Trends, Again and Again
There is no working team in any investment research organization with a stronger record for identifying life-changing investment trends at their outset than the editors of The Casey Report.
From urging subscribers to buy uranium stocks back in 1998 when uranium was trading for $9.50 a pound (and then urging subscribers to sell most of those stocks before the uranium stock crash of 2006)...
- To repeatedly urging readers to get in on the buying opportunity gold presented in 2000, at the giveaway price of $270...
- To recommending energy investments while oil was still trading at $35 a barrel...
- To warning readers that the world was on the edge of a financial crisis back in August of 2005 in an article titled Profit from the End of Western Civilization.
- And in the same article, alerting subscribers to the inevitability of rising oil prices and the collapse of the housing bubble. To quote:
"What's going on now in the residential real estate market is much like the tech bubble, but potentially much, much more serious than what went on in stocks a few years ago." (August 2005)
I don't believe that I have ever come into contact with an individual or an organization quite as thorough, knowledgeable, committed, down-to-earth and downright prescient re: any investment sector, as Doug Casey and his senior executives..."
– Thomas M.
The team at Casey Research uncovers these trends early, alerts readers to the best ways to profit, and then stays on top of the trend's development in an ever-changing investment landscape.
Need Not Apply
It's worth noting here: While we do look to generate outsized investment gains for our readers and provide specific investment advice to help you achieve these gains, we don't offer "trading" recommendations.
These trends take time to develop – and never go in a straight line... particularly in crisis markets subject to distortion at the hands of Washington and other major players.
Investing with major market trends – while it can help you become wealthy – is not "get rich quick." Our recommendations are often on a two- to five-year timeline, sometimes longer. If that's not for you, we won't be offended if you move on.
But if you do want to "get rich slowly," using the time-tested method of riding major market trends and growing your wealth through time... you're putting yourself on the right track when you invest in The Casey Report today.
That said, money moves fast in crisis conditions.
Take, for example, when the mortgage market was starting to fall apart in 2007. Though the mainstream was still hot on real estate, Doug Casey saw the underlying market instability. Predicting the collapse of the mortgage banks and insurers, he recommended shorting MBIA in September 2007 at $61.92. By July 1, 2008, MBIA share prices had collapsed to just $4.18.
With this simple recommendation, Casey readers collected 93.3% gains in 10 months.
Yes – investing in the trend is the slow and sure way to increase your wealth many times over during your lifetime. But a crisis – like our recent credit crisis and the growing debt crisis – presents "few and far between" opportunities for big gains, quickly. And this can make you far wealthier in the long run.
That's why in addition to recommending a core portfolio that stays on top of the big-picture trends, The Casey Report also features regular recommendations that are designed for shorter-term, higher-risk speculation with the potential for a more explosive upside.
How to Invest a Little to Make a Lot
Most investors are their own worst enemies. We want to chase big upside with all the money we can throw at it. After all, who wants to double a small fraction of your portfolio when you could double all of it? But unfortunately, experience shows the type of "sure thing, high upside" bets we think will double our money are often very risky – and can just as easily wipe us out as make us rich.
That's why another fundamental tenet of The Casey Report's approach is to put most of your money in lower-risk investments that still give you high upside by following the long-term trend, while setting aside a small fraction of your portfolio – somewhere around 10% – dedicated to achieving much bigger gains.
And for that small corner of your portfolio, we offer Speculator's Corner.
For example, in the July 14, 2011 issue of The Casey Report, the Speculator's Corner recommendation was to buy VIXY – an ETF that tracks movements in the VIX measure of market volatility – below $46. The upside target was from $55 to $60. Buy orders at $46 were filled July 21st. Then on August 4, as a perfect storm in the euro debt crisis shook world financial markets, VIXY rocketed through the entire target range, trading to almost $77 on August 8. Readers who sold within the range collected gains of 19.5% and 30.4%. Those who held on longer and exited at the August 8 close of $75.07 achieved a return of 63% in less than a month.
A couple other open trades from recent issues of Speculator's Corner include:
A two-part trade to profit as the European Central Bank continues debasing the euro to bail out the rapidly-decaying member states... while also protecting yourself from the dollar's downside with a double-upside play on gold's continued climb... along with specific exit instructions to ensure you have $3 to gain for every $1 you risk. The gains on this trade were 19% within two months... with far more upside expected.
Which stock to short (or buy put options on) for home-run potential as The American Debt Crisis drives US cities into financial dire straits. When this recommendation was issued on May 12, 2011, this stock closed at $16.24, and by August had already fallen below $11. Shorts were up over 39% in less than three months... and options traders saw the recommended puts go from $1.25 to $3.75 for a quick 200% gain and a "Casey Free Ride" on further upside in the coming months as the debt crisis intensifies.
Even with just 10% of your portfolio in this type of speculative play, you can imagine what type of enormous impact a few of these wins start to have on your wealth.
All of This, Every Month
While we pride ourselves on how The Casey Report helps investors increase their wealth through intelligent investments, we've also worked to make it far more than an investment newsletter. In each issue, you'll find...
A Monthly Roundtable of Independent Thinkers
For one, The Casey Report cuts through the noise, clutter, and oftentimes downright ineptitude you get from the mainstream media. We bring you the research, insights, and opinions of a monthly roundtable of independent and liberty-minded thinkers covering economics, politics, and more. These issues impact your life (and will do so even more as the crisis deepens). Having the right information is the first step in protecting yourself.A Guide to International Diversification
Also, The Casey Report features unique advice on diversifying yourself and your wealth internationally. Doug Casey, contrarian investor and author of The International Man, regularly shares "how and why" info on global living and investing. Senior Economist Terry Coxon is a leading authority on offshore trusts and self-directed IRAs that let you invest in overseas companies and markets. Many of us at Casey Research have homes, financial assets, and even citizenships in at least two countries. And we'll share with you how you can take advantage of these strategies to reduce your sovereign risk.
Just to recap, each month's issue of The Casey Report features...
- An introduction to the issue, providing a monthly bird's-eye view into what's important in the economy and on the political scene... pointing out important developments you'll want to watch for in the near future... and informing and framing the rest of the issue.
- Two or three additional feature articles covering the economy, money, specific markets and investments, war, personal and financial protection, and whatever else we feel is important to your ongoing independence, wealth, and happiness. Doug Casey regularly writes one of these feature articles, with additional articles coming from David Galland, Bud Conrad, Terry Coxon, and frequent guests.
- How to Invest – our monthly update on recommended investments, including new investments, important developments in the core portfolio, closing positions, and the Speculator's Corner for high-risk, high-reward speculations.
- The Data Farm – our monthly recap of data worth paying attention to, with our thoughts on how these impact major market trends going forward.
- Obama Watch – Don Grove, our Washington insider, with interviews and commentaries straight from the belly of the beast.
- Special Features – Recent special features have included: The Casey Research team covering the investment opportunity in natural gas... Constitutional law expert Dr. Edwin Vieira on our corrupt monetary system and the US descent into fascism... Free-market expert Richard Maybury on the fall of the US empire state... Even an interview with presidential candidate Ron Paul on the dangers of the Obama administration.
- And finally, the End Note, a monthly perspective from Doug Casey that you'll see nowhere else.
In addition to all of this delivered to your email inbox every month, you'll get immediate access to every archived issue of The Casey Report as well as an up-to-date portfolio page with all recommendations, so you can see all past commentaries on the economy, events, and most importantly current portfolio recommendations.
So How Much Does It All Cost?
The fee for an annual subscription to The Casey Report is $349 retail…. though today I'd like to make a better offer to you. Today you can start an annual subscription for just $279. This is the best deal we offer on The Casey Report, and you're guaranteed to receive this same low price for as long as you remain a subscriber.
Take it as my "thank you" for reading this special report I've put together on how to protect yourself through the continued descent into The American Debt Crisis... you get 20% off for a $70 instant savings.
But there is a way to get started for even less...
Pay Just $75 Today and
Try It for the Next 90 Days,
In addition to the "best deal" $279 annual subscription, we also have an easy quarterly subscription. Pay just $75 now to get started and for the next 90 days you get all the benefits of the annual subscription at a 14% savings off retail. Plus you lock in the same low rate for as long as you subscribe.
And it's all risk-free. Whether you opt for the annual or quarterly subscription, you get to test drive The Casey Report for the next 90 days, at our risk:
The Casey Report
Ninety-Day "Test-Drive" Subscription
As CEO and Partner in Casey Research, it's my reputation on the line if we don't deliver on every promise we make. I fully stand behind the value of The Casey Report.
So I want you try it out for the next 90 days, with the risk completely on me. Browse the archives. Get the latest issues. Weigh the value of our research and how it can impact you going forward. Follow our recommendations and see how they perform.
Then, any time in the next 90 days, make your decision. If you don't feel it's worth the fee many times over, let our customer service department know. They'll provide a prompt and courteous refund of every penny you paid, whether you ask for it tomorrow or in 90 days.Try The Casey Report Today
In Today's Crisis, It's Worth a Look...
We at Casey Research have been warning of the inevitable debt crisis in America for years. In recent months we've warned it was not only inevitable, but imminent. And now the crisis is upon us... But it's only getting started.
The American Debt Crisis is here, it's bad, and it's about to get a whole lot worse.
It's risk-free to try The Casey Report for the next 90 days to decide for yourself that it will be a valuable tool in helping you personally and financially cushion yourself from the crisis.
And of course you'll get...
- Ongoing coverage of The American Debt Crisis
- Specific recommendations for protecting your savings and investments
- Speculative profit opportunities you'll only find in crisis
- Regular research and insights into the economy, markets, and political situation
- Additional special features for independent and liberty-minded thinkers
And you can try it all risk-free for the next 90 days, whether you choose the quarterly or annual option.
You Can Get Access in Minutes...
It's easy to order. Simply fill out the order form. Click the "Get Started Now" button. You'll get an email directing you to the most recent issue of The Casey Report, plus the archives and current portfolio information.
You will also receive a special report I've put together called Investing in The American Debt Crisis that details all the recommendations covered above.
And here's what you'll want to do immediately:
- Read the special report on the recommendations from this Investor Briefing.
- Browse through the archives and especially our most recent issue to learn more about these investments.
- Decide for yourself how these investments can fit into your strategy for navigating The American Debt Crisis... and take action now.
Put all appropriate recommendations to work immediately. In this crisis, every new day can bring new developments that move the markets tremendously.Try The Casey Report Today
Before I Sign Off...
The American Debt Crisis is just getting warmed up. By the time it's over, millions of savers and investors will find themselves far worse off than they are today.
Because you've read this far, you know how important it is to protect yourself... and how profitable it can be to take advantage of opportunities as they arise.
This is how you'll come out ahead on the other side of the crisis.
The information in each month's issue of The Casey Report is first and foremost designed to help you protect yourself and profit from our debt crisis.
So take this opportunity now: Try The Casey Report risk-free for the next 90 days. Then decide for yourself how valuable this information will be for you and your money going forward.
CEO, Casey Research
What our readers say about The Casey Report
The crux of our business is giving you, our reader, the research, analysis, and investment recommendations you need to find personal freedom through financial freedom. Fulfilling this promise is what keeps us in business – and, in fact, put us on Inc. Magazine's list of America's fastest-growing private businesses.
It's also why we've received hundreds of unsolicited notes from readers about how we've helped them, including those in this Investor Briefing.
Life-altering: The money and his changed worldview
I would like to thank the whole Casey Research Team for the great product that they produce. I first heard Doug Casey speak a few years back at a financial planning seminar in Tampa. I have to say it was a life-altering event, not only from the fact of the money I have made on Doug's recommendations, but from the way I view the world today. Thanks for all you do for your clients."
– Mike H.
An anchor of hope in today's rapidly-decaying world
Thanks to all at Casey Research. Your research and reporting give me an anchor of hope and sanity in today's social, cultural, financial, political and legal environments, which are all decaying rapidly, compared to what we used to have and take for granted in this country. You have guts and courage and principles, and you articulate your arguments intelligently and logically, and thus with authority. I salute your work and journalism and I encourage you to continue to ‘swim against the stream' of this steadily degenerating ‘LiLo’ culture."
– Bruce S.
The confidence to grow old without worry
I wanted to take a moment to drop you a note letting you know that Casey Research has changed our fiscal future and my view on the geo-political scene in a very positive and productive way. Your team has given me the confidence to grow old in this world without the need to worry about people, policies and places negatively affecting myself or my family because I’m far better prepared. You and your team have given me the education and advise that I’ve been searching for and I and my family thank you."
– Jason C.