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You can ride it to riches — or let it crush you
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Fellow Investor, If you don't know what "reflation" is, you're about to find out. And you can do it the easy way, or the hard way. The hard way -- which is how most people will discover it -- is after it kicks in. But by then, it'll be too late to protect yourself. The easy way, which I'm offering you right now, is to learn about it just before it kicks in -- and to take the few easy steps necessary to profit from it. And if it seems like I'm suggesting that you turn what for most people will be a financial catastrophe into a huge money-making opportunity for yourself... well, forgive me if that sounds heartless.  But here's the reality... Times have changed. You know it and I know it. The days of everybody getting rich and nobody getting hurt in the financial markets are gone. And in the economy at large -- now "under new management" by a set of big-government ideologues intent on socializing everything that moves -- things are only worse. Now, here's where I'm optimistic... I don't think these new would-be Masters of the Universe will succeed -- not in the long term anyway. Free-market capitalism will survive if for no other reason than that the central-planning alternatives can't. But our new financial overlords likely will succeed in their short-term strategy -- which is to expand the money supply to a scale never before even contemplated. That's "Reflation" in a Nutshell... ... the deliberate attempt to induce inflation by pumping vast sums of money into the economy. Unfortunately, this money doesn't exist and is being created out of thin air. Now, if that sounds like the kind of irresponsible buy-now-pay-later thinking that got us in to the crisis we're in today, well... you're right. But the horse, as they say, is out of the barn -- and there's nothing you or I can do about it. Except this... We can anticipate the likely consequences of these "reflationary" policies, and position ourselves to take advantage of them.  In a moment, I'll explain those consequences -- and the tactics you can use to profit from them -- in detail. For now, it's enough for you to understand that government "reflation" efforts will lead to rapid price increases in certain sectors of the economy -- but not in many others, where things may actually get worse. Distinguishing which prices are likely to go up, then, from the ones that will go down, is the key to profiting from "reflation" rather than just being a victim of it. Make no mistake, however: The rumbles from the fast-approaching "reflation" train are already being felt. And as it barrels down the track, you've got a choice -- ride it to riches, or get crushed under its wheels. Fortunately, I'm offering you a ticket to ride... The 2009-10 Express Train to "Reflation" Riches --
I'm an American, but I make my home in London -- where I'm an SEC-registered investment advisor and the founder and Chief Investment Officer of Global Guru Capital. I have degrees from Stanford and Harvard, and am a Chartered Financial Analyst (CFA). I'm also founder of the London Junto -- an inner circle of top money managers and other so-called "Alpha Investors" who together are responsible for about a quarter of all the hedge fund money in Europe. You may have come across my market insights in The Wall Street Journal, Forbes, Fox Business News, CBS MarketWatch, Yahoo! Finance, and MSN Money Central. I've also been quoted in investment publications in countries as far afield as India, Germany, Italy, Belgium, and even tiny Estonia. My investment philosophy? As an old Alpha Investor saying has it: "There's always a bull market somewhere." Or, to put it another way: No matter what the state of financial markets, there is always a strategy out there that can make you money. That's the idea behind my Global Stock Investor investment newsletter, and it's paid off big-time for my subscribers. For instance, I was among the first to see the coming profit waves in soft (agricultural) commodities, emerging market telecom, and other hot new trends -- enabling my subscribers to bank hefty profits like these:
Keep in mind that I made all these trades in 2008 -- a year when most global markets were down 50% or more. And consider this: While the major stock indexes were down as much as 20% last October, my subscribers were actually enjoying double-digit gains. To be specific: One of our four investments during "Black October" was up 7%. Another was up more than 16%. A third soared more than 20%. The fourth was also in positive territory. Not a single one was in the red. And all that in the midst of a financial panic that wiped out some $10.5 trillion in investor wealth -- and even put some of the world's top hedge funds out of business. Since then, my Global Stock Investor portfolio's open positions are continuing to boast double-digit profits. What's my Secret? In Theory, it's Not that Complicated...  The key is to recognize opportunities wherever they may be and, more importantly, detach yourself from old strategies that are no longer working. You see, in today's radically altered investment environment, pretty much every tool in the traditional money manager's toolkit has been ineffective. From "buy and hold" to "diversification" to analyzing P/E ratios -- none of the "time-tested" strategies seems to work any more. All of this uncertainty is inducing a never-before-seen vertigo among both analysts and investors. But Alpha Investors know that during times of uncertainty, it's best to pull in your horns, shorten your time horizons, and bet selectively on a handful of short-term opportunities until the dust settles. And Right Now, There's no Better Profit Opportunity than What Alpha Investors Like to Call the "Reflation Trade"...  You see, whenever government intervenes in the economy to a significant degree -- whether through taxes, spending, regulation, or manipulation of the money supply -- there will be winners and losers. Discerning which is which, however, is no easy matter, unless you have the inside scoop on whose ox is getting fed and whose is getting gored. But with "reflation" -- especially on the mind-boggling scale our government is pursuing it -- the effects are so massive and widespread that "inside" knowledge isn't necessary. All you really need is a little foresight based on common economic sense. And in the next few moments, I'm going to reveal to you four of my favorite reflation profit opportunities -- just to entice you to try Global Stock Investor at zero risk... Reflation Profit Opportunity #1: Remember when dotcoms and, more recently, China stocks were all the rage? As always, the average investor got to the party too late -- and then got soaked when the bubble burst. But savvy Alpha Investors made a quick and handsome fortune by betting against these bubbles. Examples:
Smart moves -- but never again, right? Because all the bubbles have already burst, right? Wrong. With the collapse of every asset class from stocks to real estate over the past 18 months, you may be surprised to learn that we are in fact in the midst of one of the greatest financial bubbles in history. The reason it's hard to spot? This bubble isn't motivated by greed, but by fear. You see, the flight to safety since the market crash last fall has sent fearful investors into U.S. Treasury bonds in unprecedented numbers -- driving yields down (which implies a rise in price) to historic lows. But the lofty prices and low yields on Treasuries are only sustainable if you really think that the global economy will be locked in a deflationary spiral until 2019.  Also, low yields offer no protection against the return of inflation. At current levels, U.S. Treasury yields imply inflation will be negative over the next 10 years! And if you believe that scenario, Treasury Secretary Tim Geithner has some toxic assets he'd like to sell you. But the Alpha Investors of the world know better -- and as with previous bubbles, they're sounding the alarms. Pacific Investment Management Co. (PIMCO) bond guru Bill Gross called Treasuries "the most overvalued asset in the world, bar none." His colleague, Mohamed El-Erian, chief investment officer of PIMCO, has warned: "Get out of Treasuries. They are very, very expensive." Edward Chancellor, author of Devil Take the Hindmost: A History of Financial Speculation, argues that U.S. Treasury bonds have all the elements of a classic bubble. Alpha Investor George Soros has also said that U.S. Treasuries are in a bubble, and that he expects both inflation and interest rates to rise. Why are the world's Alpha Investors so bearish on the outlook for Treasuries? reasuries are under tremendous pressure from both the supply and demand side. On the supply side, the U.S. Treasury needs to boost debt issuance significantly to meet financing needs of $2.5 trillion in 2009 alone, and another $1.2 trillion in 2010. That's an unprecedented level of debt coming on the market. It also means that the Treasury will have to pay higher and higher interest to attract investors -- pushing prices down, and the yields demanded by investors up. Consider the case of China. As a result of the economic slowdown, U.S. consumers are buying a whole lot fewer things that say "Made in China." That means a lot less business for China's manufacturing sector. That also means less tax revenue for the Chinese government. Less tax revenue leads to a lower budget surplus and a lower trade surplus with the United States. The result? You can expect that the amount of excess U.S. dollars that are funneled back from China into the Treasury market is set to decrease substantially. To date, some $7.2 trillion has been pledged to support the U.S. financial system, and $2.6 trillion has already been spent. It's inconceivable that this money creation won't lead to inflation. Finally, to add insult to injury, even good news is bad news for U.S. Treasuries. Assuming the massive fiscal and monetary stimulus works, any relief in global financial markets will mean that money will come out of U.S. Treasuries and go somewhere else. The bottom line? The collapse of Treasuries seems to be not a matter of "if" but "when". The best way to profit from that collapse is an ingenious exchange traded fund (ETF) I've spotted that delivers twice the inverse of the long-term U.S. Treasury Index.  Former Morgan Stanley market maven Byron Wein predicted in his annual "Ten Surprises for 2009" that 10-year U.S. Treasury Yields will climb to 4% by year-end on rising inflationary expectations. That development would send this ETF soaring. Bottom line: This leveraged position may turn out to be the equivalent of betting against subprime loans in 2007. With U.S. debt issuance at a record high and Treasury bills at a record low, this may be the trade of the year for 2009. I'll tell you more about this easy-to-buy ETF in a FREE Special Report I'd like to send you called All Aboard the "Reflation" Train: 4 Ways to Profit from Reckless Government Spending and Monetary Policy. I'll tell you how to get this FREE Special Report in a moment -- but first, let me tell you about three more great investment picks you'll find in it... Reflation Profit Opportunity #2: Betting Against the Dollar -- When the bubble in the U.S. Treasuries bursts, the bubble in the currency to which it is inextricably linked -- the U.S. dollar -- will burst along with it. So far, of course, the dollar has been sustained by the same "flight to safety" dynamic that created the Treasury bubble. And, ironically, its seeming strength relative to other currencies has removed whatever fears may have remained about debasing it through inflation. But the signs are unmistakable that the dollar is headed for a spectacular fall -- and soon.  Among those signs, none is more alarming than the increasingly vocal discontent with our government's recklessly inflationary policies coming out of China. First, on March 13, Chinese premier Wen Jiabao fired a warning shot by telling Washington, in effect: Don't devalue the dollar through reckless spending. After all, China is America's biggest foreign creditor, with an estimated $2 trillion in U.S. government debt. A weaker dollar would erode the value of those assets. "To be honest, I'm a little bit worried," Wen said. "I would like to call on the United States to honor its words, stay a credible nation, and ensure the safety of Chinese assets." Then, on March 23 -- just before the G20 meeting of the world's industrial and developing nations in London -- China's central bank governor publicly called for the creation of a new currency to eventually replace the dollar as the world's reserve currency. That's unlikely to happen any time soon. But, like Treasuries, the precipitous decline in the value of the dollar is not a matter of "if" but "when." Meantime, how to protect yourself? Answer: By investing in the currency that, in stark contrast to the teetering dollar, is hands down the strongest and most undervalued currency on the planet. In fact, based on The Economist magazine's recently published annual "Big Mac Index" -- a tongue in cheek measure of "purchasing power parity" (PPP) -- this currency is currently undervalued by a whopping 49%. That's why The Wall Street Journal calls this currency "one of the few sure bets in global financial markets." The best way to invest in this steadily rising currency? Another easy-to-buy investment that trades on the NYSE and offers steady, long-term appreciation and a rare safe haven in otherwise tumultuous markets. I'll tell you more about this currency bet in my FREE Special Report All Aboard the "Reflation" Train -- which also includes... Reflation Profit Opportunity #3: As my subscribers know, I am not a gold bug. But there are certain times when gold offers a solid investing opportunity -- and here's why I think right now is one of them... First, gold is the ultimate inflation hedge -- and as Milton Friedman famously observed, "inflation is always and everywhere a monetary phenomenon." Increasing the money supply devalues the currency -- there's no escaping that. As inflation starts to kick in, gold will soar. Second, gold is a traditional safe haven investment and tends to do well when fear in the markets is high.  Since 1971, the dollar has been backed not by gold but by "the full faith and credit of the U.S. government" -- a phrase that once sounded reassuring, but no more. Third, gold is emerging as a favorite among some of the world's most successful Alpha Investors... Gold is the largest investment in the portfolio of activist hedge fund Greenlight Capital, led by Alpha Investor David Einhorn, which has generated greater than a 25% annualized net return for partners and investors. Alpha Investor John Paulson, who made $15 billion in 2007 betting against subprime mortgages, has also recently added to his gold holdings -- telling clients his hedge fund will offer its investors a new share class denominated in gold. Bottom line: Whether you are a gold bug or not, gold is proving its mettle as an alternative to stocks, corporate bonds, and U.S. Treasuries with microscopic yields. So, what's the best way to invest in gold? Here, my Global Stock Investor portfolio is playing follow-the-leader -- recommending the same global gold-producing company in which John Paulson just took a major stake. This rock-solid company has no fewer than 21 active gold-producing operations and an even larger number of exploration programs in gold-producing regions of the world. During 2008 alone, it produced 4.98 million ounces of gold from its operations. It also derives revenue from the sales of silver, uranium oxide, and sulphuric acid. Again, I'll tell you everything you need to know about this company in your FREE Special Report, All Aboard the "Reflation" Train. But first, let me tell you about the fourth and final "reflation" profit opportunity you'll find there... Reflation Profit Opportunity #4:
Commodities are tangible assets that have real utility and are a storehouse of value -- unlike government paper. So, when the world can no longer trust our paper money, people turn to commodities as a refuge. That's one reason why, as the dollar goes down due to reckless government spending and monetary policy, commodities will increase in price -- especially as the global economy begins to recover. And there's no better way to profit from the coming bounce in commodities prices than to bet on "Dr. Copper -- the commodity with the Ph.D. in economics." Here's why I think "Dr. Copper" is set to soar over the coming months... As a result, its price movements have been a reliable leading indicator of the health of the global economy (hence the nickname). Look behind doom and gloom headlines and you find that demand for copper has been rising steadily. Since bottoming in December, the price of copper has risen 28% in 2009 after plunging 54% last year. Now, rumor has it that China's SRB may raise purchases to 1 million tons from 600,000 tons, easily turning the projected global surplus of 350,000-400,000 tons this year into a deficit. Since late February, London copper stockpiles have fallen over 50,000 tons. And in March, copper topped $4,000 per ton for the first time since November. The best way to catch the wave? An ingenious kind of debt security that follows the price of copper on a one-to-one basis. You'll find everything you need to invest in it -- and the three other "reflation" plays I've spoken about -- in All Aboard the "Reflation" Train: 4 Ways to Profit from Reckless Government Spending and Monetary Policy. Again, this Special Report is yours FREE with your no-risk trial subscription to Global Stock Investor. What Alpha Investors Know that Ordinary Investors Don't In a world where none of the tried-and-true investing bromides seems to apply anymore, there is one general rule that will stand the test of time... Economic conditions don't have to be great to make money in the financial markets.  The important thing is to be flexible -- to be ready and willing to adapt your investment strategy to current market conditions. That's what we do for you at Global Stock Investor. Rather than stick blindly to what worked yesterday, we're always looking for what works now -- and what will work tomorrow. Taking advantage of the inevitable effects of "reflation" is one strategy that works today. It may not work a year from now. But you can count on one thing: before it stops working, my subscribers will have long since moved on to much "greener" pastures. Save 60% with this Zero-Risk Trial Offer One year of Global Stock Investor normally costs $249. But for a limited time, you can try this exciting source of money-making advice at the Special New Subscriber Rate of just $99.95 -- that's 60% off the regular price. (And a tiny fraction of what I charge my private clients to manage their global investments.) Think about it: that's around 27 cents a day to instantly get the best global investment advice available anywhere. So, for just $99.95, you'll receive:
And, if You Act Today, You'll Receive
Still not sure? Don't Worry -- You're Protected by I want you to be sure about Global Stock Investor-- so take time to read it and track my recommendations for a while, knowing that you're protected by this double guarantee:
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Remember what I said earlier: During times of uncertainty, it's best to pull in your horns, shorten your time horizons, and take advantage of a handful of short-term opportunities until the dust settles. Right now, "reflation" plays are where the profits are -- and there's a long way to go before the picks I'm recommending in this letter have exhausted all their profit potential. So don't delay -- the sooner you subscribe, the bigger the profits you'll enjoy. Reserve your place now by clicking on the "subscribe" button below or by calling toll-free 1-800-211-4774 today! Sincerely, P.S. Subscribers to Global Stock Investor have made money during some of the most difficult conditions in recent financial memory. The moment you join us, I'll rush you my FREE Special Report, All Aboard the "Reflation" Train, which reveals all the specifics about the four "reflation"-fueled profit opportunities I've talked about in this letter. But hurry -- to capture the biggest profits you must make these moves now. To find out the names of my reflation bets, call toll-free 1-800-211-4774 or click on the "subscribe" button below right now. |
My name is Nicholas Vardy. Since I'll be taking you on this ride to riches, let me introduce myself.
A copy of my FREE Special Report, All Aboard the "Reflation" Train
