In the coming weeks, I’m going to release some of the most important investment recommendations of my career — to go for the explosive profits that are generated when the economy sinks.
If you’d like to get them and ride this powerful wave to an unprecedented wealth building opportunity, be sure to watch this video.
If not, at least take some of the urgent steps to protect yourself that I’ll tell you about here this morning.
But first, if you think Friday’s horrendous job number was a shocker, consider this:
The U.S. government — the last and
only financial savior of the economy —
has run out of money!
It borrowed massively from millions of citizens. But that wasn’t enough.
It borrowed a shocking $4 trillion from China, Japan, OPEC countries and even emerging market countries like Brazil … and that wasn’t enough either.
It ran the printing presses around the clock, and even THAT wasn’t enough.
Now, despite all the government stimulus, government rescues, government borrowing, and government money printing, the economy is STILL stumbling and slumping …
* The job market is coming apart at the seams! Job growth plunged 77% from last month — from 232,000 to a miserable 54,000 — less than ONE THIRD what Wall Street was expecting! And the disaster wasn’t just in a few weak sectors either. We saw actual job LOSSES in temporary help, retail, government, and major sectors.
* Manufacturing is fading fast! The Institute for Supply Management’s key manufacturing index plunged to 53.5 in May from 60.4 in April. That mirrored an epic fall in the group’s service sector index, and a report from the Fed showing industrial production flat-lined in April.
* Housing is sinking again! New home starts plunged almost 11% in April. Pending home sales fell 12 times as much as expected. Prices nationwide have just plunged to the lowest levels in nearly a decade. Over 2.2 million homes are in foreclosure. Millions more are in the pipeline.
* Consumer spending is on the ropes! Retailers as diverse as Gap, Staples, Lowe’s, Polo Ralph Lauren, Jos. A. Bank, and Target have all warned about sales and earnings trends. A key consumer confidence plunged to a six-month low of 60.8 in May, missing estimates by a country mile. Auto sales dropped by almost 4% last month, plunging the annualized rate to the lowest since last September.
I’m not an optimist or a pessimist by nature. I’m a realist. And all I can say is that the data is UNAMBIGUOUSLY pointing to a massive decline.
What’s most remarkable is that, in order to prevent just this outcome, the U.S. government spent trillions of extra dollars … borrowed trillions more from overseas … and printed still MORE trillions to pump into the housing market and the economy.
And at every step of the way, they SWORE on a stack of bibles that if we just flushed enough borrowed and printed dollars down the toilet, it would somehow defeat the economic cycle.
Well the evidence is now clear: They were wrong. And unless you take defensive action — or better yet, offensive action — you are the one who’s going to suffer the consequences. While our political leaders either get re-elected or march off into the sunset, the one that has to pay the price is you and me!
But whatever happens, don’t ever say we didn’t warn you. We’re warning you now. And we warned you before. From the get-go, we told you that the recovery was bought and paid for by the government and that it was doomed to fail.
What should prudent investors do?
First and foremost, get your cash to safer place.
Bank failures may not be at the top of the news right now. But they’re happening just the same. Meanwhile, the establishment rating agencies are finally beginning to recognize the sinking bank finances that our low bank ratings have been warning about all along. Get the Weiss Rating on your bank. Then get out of any bank with a rating of D+ or lower. Among them are some of the biggest!
Second, reduce your exposure to U.S. stocks. Take profits off the table. And whether at a profit or a loss, get out of the most vulnerable sectors — banks, housing, construction, retail, and more.
Third, don’t forget the dangers facing long-term bonds. Sure, you’re always going to see some flights to quality temporarily drive up bond prices. But don’t let that fool you. The federal deficit is a monster. The Fed has pumped money into the economy like crazy and is continuing to do so. That means inflation is already in the pipeline — bad news for bonds.
Fourth, for vulnerable investments that you’re unable or unwilling to sell, hedge! For almost every investment sector and asset class, there are specialized ETFs designed to go UP when your investments go down, helping to offset losses.
Fifth, go on the offense. Use this crisis as an opportunity to turn sour lemons into sweet lemonade.
I show you how in my video.