A MoneyWeek Magazine Special Report:
Three financial tripwires you MUST avoid in 2012
Your savings, your share investments, your pension pot – ALL could be at severe risk over the coming months…
There are 3 major dangers we think you need to steer your money away from FAST – or they could hit your ‘safe’ investments hardest.
One wrong foot and you could lose a large portion of your invested wealth within the next 12 months.
You need to act NOW.
Read on to discover what these tripwires are… how you can sidestep them… and three smart ways you can prosper from the panic.
Dear Fellow Investor,
Things could be about to get very nasty…
Right now, the investing landscape is littered with buried mines.
And we see that hundreds of unsuspecting investors are about to walk right into them.
With Britain’s stagnant economy, the debt crisis in Europe and the big slowdown of emerging markets… dangers are pocketed everywhere, in practically every asset you can think of. And in many assets you already own.
That means you have very likely already made a few mistakes that we think you must correct immediately.
The value of your shares.
Even your long-cherished retirement plans…
Everything you have worked hard to secure.
They are ALL seriously under threat.
One false move, one wrong foot over the next 12 months… and there’s a danger you could blow them all to bits.
So what do you do?
How do you proceed safely?
This is the question you are probably asking yourself right now.
You’ve seen it all unfolding on the news, and in the papers, day by day.
You know all about Greece being on a ‘razor’s edge’… about the possibility of another banking meltdown… about a continent-wide recession.
But the Eurozone fiasco is only part of the problem.
As we’ll show you, there’s an even bigger unseen threat looming that could sideswipe thousands of unsuspecting investors.
If we’re right, many investments will prove to be financial disasters. In particular there are some specific, popular investments that we urge you to avoid at all costs.
I’m certain you hold at least one of these investments. Probably even two.
Your colleagues, your friends, your broker… they won’t know what to do.
Like most people, they think the turmoil that we’re in is just a blip.
But I’m afraid they’re wrong. The investing landscape has changed forever.
Global sovereign debt is rising to dangerous new levels, forcing governments to meddle more and more with the financial system. Markets are being manipulated like never before – rising and falling wildly on every scrap of information that hits the news.
This is the biggest financial crisis for a generation.
And all the old rules of where to store your cash under normal economic conditions are being re-written.
In the bull market, investors got used to plucking FTSE trackers, blue-chips and bonds
But that’s the way the world used to work. Not anymore. You must adapt as an investor and find new havens for your wealth.
If you are investing for the future, for your family and lifestyle, things have become a lot more challenging.
Here at MoneyWeek, Britain’s best-selling financial magazine, we are deeply concerned.
We see UK investors feeling their way through the treacherous investment minefield and we are worried for them.
Because there are a number of ‘tripwires’ we think you MUST avoid to come out of the next 12 months with your money preserved.
We warn you – making the wrong move in the year ahead could pose a serious threat to your financial standing.
That’s why we’ve picked out the three most dangerous tripwires we think you need to steer clear of in 2012. We’ll show you what they are and how we think you can avoid them.
My team of analysts call these three threats “tripwires”, because to the man in the street, they will come as a complete surprise.
At the very best, the next few years are going to be a wealth-draining slog that eats into your hard-earned savings.
And at the very worst, the fallout for regular investors like you could be horrendous.
No matter how much you are worth, how much you earn or how much you own, we think urgent action is required to protect your current assets from serious harm.
Fortunately, in this special report, we offer you our practical solutions.
By making the right investment choices, we believe you’ll not merely preserve your assets, but make a decent profit, even as the 2012 crisis worsens.
Specifically, we have uncovered 3 counter movesdesigned to not merely ‘bunker’ your wealth during the coming months, but grow it by considerable measure.
So let’s start with the biggest threat to your wealth right now…
FINANCIAL TRIPWIRE #1:
How the stock market’s ‘unexploded bomb’ could trash 30% of the stocks on the FTSE 100!
Hardly anyone is talking about this right now.
That’s why very few people will see it coming.
But we believe, over the next 12 months, you will witness the collapse of one of the world’s biggest and most important economies.
And we think it is about to knock the Eurozone off the headlines, and likely to cost you a lot of money.
In fact, if you or your pension fund track the FTSE…
If you own any mining stocks or commodity shares…
Or if you are invested in emerging markets…
In our opinion, a large portion of that money is at risk.
Right now around 30 of the shares in the FTSE 100 are directly exposed to this tripwire. (More about that later.)
That’s why, when this catastrophe starts to unfold, we believe a large number of the blue-chip stocks you hold could be slashed in value.
But you won’t hear this story from the mainstream press, the Square Mile or
Instead, they’ll tell you about the Eurozone crisis one day… and the looming UK recession the next…
You’ll flick through the papers and read about soaring unemployment… inflation… the debt crisis… one soundbite at a time.
But they’re missing the big picture.
Fact is, there’s a storm brewing far away from Brussels – an enormous threat that we think will be even worse than what’s going on in Europe.
And it could be about to sideswipe thousands of regular investors while they’re looking the other way.
We’re worried that includes you.
At the moment, this story is almost completely off the radar.
Most analysts haven’t yet picked up on the tell-tale signs that something terrible could be about to happen…
In fact, most mainstream investment experts don’t think it’s even possible.
But we have seen threats just like this one underestimated before.
Subprime, the collapse of Lehman Bros., the banking meltdown – they caught the majority of mainstream investors completely by surprise.
That’s why it was far too late for them to protect their investments from harm.
I want to show you how we believe you can avoid that fate. Over the following pages I’ll explain precisely what’s going on and the simple ways you can respond, if you act quickly.
Worryingly, many asset managers are still advising their clients to invest HEAVILY in an economy that, to us, looks massively overheated.
A recent study by Bank of America revealed that 61% of fund managers are still happy to funnel their clients’ money into this danger-area by the million.
We are seeing the same sort of reckless complacency now as we saw before the subprime disaster… despite many of the same warning signals.
And that is extremely dangerous.
So what is this looming catastrophe?
I’m talking about the coming collapse of China.
And unless you brace your portfolio for the shock – it could really cost you.
All our research and experience tells us China is about to suffer a horrendous correction. And that means UK stocks, too.
To put it very simply, we believe:
China’s gigantic property bubble is about to BURST
In the financial world, it’s pretty well known that China’s economy is propped up by a relentless ‘building mania’.
China’s enormous property market is the driving force behind its huge growth over the
If the property market crashes, it will be like pulling the rug from under the entire
And we can reveal the collapse may already have begun…
In the UK, a construction boom means a few new housing projects…
But in China, it’s on a different scale entirely. For the last decade China has been a construction whirlwind – building an average of ten cities a year.
In the process they have driven up the global price of oil, concrete and raw commodities like copper and steel.
They have laid millions of yards of railroad tracks… hundreds of thousands of miles of road… built scores of airports… thousands of malls… endless apartment buildings and
China’s building boom is the largest in history.
For nearly a decade it has driven up property prices, spurring bigger and bigger
But now demand for the endless real estate is falling off a cliff.
Crash-landing: Property prices are nose-diving in China – a warning sign that the bubble
This graphic from The Wall Street Journal shows that property prices started falling rapidly in 100 Chinese cities over the course of 2011.
Property agency, Homelink, reported that prices of new properties in Beijing fell by 35% during the month of November alone, as developers slashed prices to clear stock.
On the China Law blog last month, Steve Dickinson talked of prices falling by 30% in Qingdao (a city on the east coast of China), where he lives. Sales have slumped, work on uncompleted projects has slowed or stopped, and developers have stopped buying land.
And in February a new government survey revealed that average property prices in 70 Chinese cities fell for the fifth consecutive month.
There are dozens of other horror stories out there, including tales of families pooling their savings to put deposits on flats, only to see their value then plunge as desperate developers try to offload the unsold units.
The overriding reality is this: there are too many properties and not enough buyers.
There’s one unconventional indicator that also raises alarm… a warning signal that has proven eerily accurate in recent years… It’s called The Skyscraper Index.
Disaster building: By 2017, China will have 4 times more skyscrapers than anywhere else in the world.
In 1999 Barclays Capital started the index to show which countries had the largest number of skyscrapers under construction…
The theory is simple: when countries start competing with each other to play host to the world’s tallest building, a financial crisis isn’t
The index basically highlights a gross misallocation of capital towards the
And it is has proven incredibly accurate.
In 1997, the Petronas Towers in Malaysia – then the tallest buildings in the world – were nearing completion. That summer, the Asian financial crisis ripped through the region.
In 2009, the exterior of Dubai’s Burj Khalifa – the tallest building in the world – was completed, amid global recession. Months later, the Dubai government came close to defaulting on its debt.
So who came top in 2011?
And that could be an ominous sign.
Right now, China is building 53% of the skyscrapers in construction around the world – lumping billions of yuan into huge housing and commercial projects.
In a property market that is cooling fast – that is extremely dangerous for investors exposed to China.
I can say with some confidence, that very likely includes you.
And what is surprising is just how rapid the decline has become.
Eggs in one basket: China is throwing billions into huge construction projects even though demand is falling through the floor.
In fact, we say it’s a crash.
But the world’s fund managers and brokers are ignoring all the warning signs and continue to pile other people’s money into this danger zone.
Remember, if you have a pension plan, or FTSE tracker – it’s highly likely you are directly exposed to a China crash.
And if your portfolio has FTSE shares, commodity plays or Asia exposure, you could be
In a moment I’ll show you a very simple way you can move your money from this
First – let’s look at why prices are falling so rapidly right now.
Well, up until 2008, China’s economy was based on booming exports.
But the European financial crisis put an end to this by freezing global trade
In a desperate attempt to keep its economy fired-up, the Chinese government went on a massive spending spree, pumping out loans to fund huge infrastructure development.
But as inflation ticked higher, the government started to pull the reins in.
Developers ignored the restrictions and kept right on building, expecting the government
This has created a dangerous stand-off… and in our opinion, a sure sign that property sales are about to start to fall even faster… an event that could send this multi-trillion dollar sector in a tailspin.
And signs are that it’s already started…
Property sales are beginning to slump drastically – soon many developers won’t be able to cover their costs.
The most cash-strapped developers could be forced into a firesale of their properties, sharply lowering prices to attract buyers.
The sense of panic will be palpable.
In a competitive market, once one developer starts to lower prices, everyone will be forced to follow. The result would be a write-down of asset value and profit expectations across
In fact, according to Alan Chiang Sheung-lai of property consultant DTZ in the South China Morning Post: “The price war has begun.”
If this ‘price war’ spirals out of control, we see only one outcome: China’s financial system could buckle.
After the property bubble pops – China’s banks
You see, China’s banks are hugely exposed to the property market…
Around 35% of China’s bank-loan books are directly tied to the property sector.
To put it another way, all of China’s eggs are in one hell of a rickety basket.
If property prices continue to fall, we believe it will knock land prices lower and kick-off a wave of defaults.
With growth slowing and asset quality crumbling, the Chinese government would have a fully-fledged crisis on its hands.
Just like the subprime disaster in the US, the Chinese economy has wrapped itself around its bloated property market… so if it crashes, the whole system becomes severely weakened.
That’s the worst-case scenario. And we think it’s very likely to come to pass…
We believe a serious property crash could knock more than two percentage points off China’s GDP.
Right now, China’s economy is growing around 9% a year… that may sound incredible to us here in Britain as we get used to a stagnant economy… but all is not what it seems.
With an enormous workforce of 550m to employ, China must keep growing FAST to avoid being swamped by unemployment.
Until very recently, it was generally accepted that China has a ‘stall-speed’ of around 8% a year. That means, if it grows lower than 8%, it could face a recession.
Yet now, even China has admitted that it can’t keep up the pace. Chinese Premier Wen Jiabao recently slashed growth forecasts to 7.5%.
Still, cheerleaders for the ‘dragon economy’ say this is all just part of China’s policymakers managing an effortless transition from an export and construction-driven boom, to a more mature, consumer-led economy.
We think they’re wrong. No government in history has managed to get rid of the boom and bust cycle, and China’s isn’t about to buck the trend.
The question is:
How much could China’s crash-landing cost YOU?
The short answer is: we think it will cost you a great deal.
In fact, the Chinese property market could be “the most important sector in the universe”, as Jonathan Anderson of UBS put it last year.
That means China’s looming implosion could hurt your investments.
If you are invested heavily at the moment, we can say that with some certainty.
More specifically, if you hold a FTSE tracker and have your money spread over a number of popular bluechips ‘plugged in’ to China, you could see those holdings severely devalued.
More than 30% of the stocks on the FTSE 100 rely heavily on China’s prosperity for revenue. So there’s a good chance you hold a few of these stocks yourself.
You need to avoid these stocks completely – in a moment, I’ll show you how.
Because a crash-landing could hit their share prices hard.
And the damage may not end there…
There’s a worryingly large group of mining and commodity shares massively exposed to China that could see a violent downward correction.
It’s very possible you own at least one of these companies, right now.
Likewise, if you have ploughed some money into an emerging market fund, like thousands of investors here in Britain… there’s a good chance China’s looming crash-landing could send those investments reeling.
Think about it: China is the hero of the emerging market story that’s been unfolding over the last decade. Practically every burgeoning Asian economy feeds from China’s success. Should the trade flow stall, it could be like severing an artery.
We’ll show you precisely which companies we think will get hit worst, plus a number of crucial investments you can make to respond to this threat ASAP.
Because the full, knock-on effects of China’s crash-landing could prove a nightmare for unprepared investors here in the UK.
In 2007, when the subprime disaster hit, a wave of uncertainty saw investors jumping out of the market like rats from a sinking ship.
Could something similar happen again? We believe it is possible.
The worrying thing is, there looks like no way out for China…
As legendary investor Jim Chanos points out, they are likely to keep building until it all comes tumbling down…
“They can’t afford to get off this heroin of property development…
It’s the only thing keeping the economic growth numbers growing.
It’s Dubai times a thousand… on a treadmill to hell.”
We don’t claim to be able to predict the future and we don’t claim to have all the answers.
But we do think you need to adjust your investments as soon as you can to prepare for this potential catastrophe.
It’s one of the biggest property bubbles in history.
Bigger than Japan in the 80s.
Bigger than Dubai’s $1trn collapse.
Bigger still than the subprime disaster that kick-started the last recession!
And when it pops – as we predict it will – it could shatter a large number of investments here in the UK.
Don’t make the mistake of thinking this won’t hurt you and your money.
Our advice: you need to urgently move your money away from assets heavily exposed to China.
And we think you need to do it fast…
As Steve Dickinson puts it on the China Law blog:
“Once a real estate bubble bursts, there is no government powerful enough to stop the resulting collapse in prices and subsequent effects.”
When the subprime disaster unfolded, thousands of UK investors were caught napping and paid a heavy price for it.
Don’t let it happen to you.
There IS something you can do to protect yourself… and even increase your wealth
Firstly, let me be clear… we are not suggesting you sell your assets right now in a blind panic.
Not at all.
What we ARE saying is that now is the time to start adjusting your invested wealth to help guard against the threats present in the global economy.
Because the fact is, there are always places to protect your wealth in times like this… and there are always strategic, profitable moves to make — even if everything comes
That’s why I’m also going to tell you about investments that we believe will be resilient in the coming months and years however things play out…
These investments could help you protect and GROW your wealth… no matter
Among them you’ll find one of the safest, best investments you can make — something you can hold for the next decade and which you should be able to ignore the whole time!
We believe that if you hold this investment, you will end the period making a far larger return than you ever imagined.
Plus we’ll reveal one savvy way that could see you bank a profit from China’s likely crash-landing. I’ll tell you more about it in the pages that follow.
But first, the most crucial thing to do is warn you of the next financial tripwire you need
An asset you are probably already exposed to right now that poses a real danger to your wealth…
Because we believe it could be on the verge of a monumental crash in value…
FINANCIAL TRIPWIRE #2:
Ditch this doomed currency NOW – before it
drags your money through the floor!
Europe’s problems just won’t go away.
You’ve seen the meltdown unfold blow by blow, so I’m not going to bore you by repeating any of it.
The real story is this: the sovereign debt crisis threatens to destabilise the whole continent, perhaps taking the euro with it.
With every passing day comes a new, shocking twist – each wave of bad news edging the Eurozone to a point of collapse.
It’s a total disaster.
The way we see it, the on-going problems in Europe can only end in one of two ways…
And both could mean disaster for the euro.
Things have got SO bad… it’s simply too late
If any more of the PIIGS countries (Portugal, Ireland, Italy, Greece and Spain) admit they can’t repay their bondholders… or a MAJOR economic power like France begins to look like going under… well, there can only be two outcomes:
1) They’ll either be forced to declare themselves officially bankrupt, or…
2) Pull out of the euro altogether.
The clock’s ticking on the single currency.
Either way, it will be catastrophic for the single currency.
Right now, we think the euro is dangerously overvalued.
And our message cannot be any clearer:
DITCH THE EURO TODAY.
Our view is simple: you should remove most euro assets from your portfolio as fast as you can… and don’t buy all the talk of a euro recovery coming in 2012.
Now of course, there’s much more to this story. Much more… too much to cover here — that’s why today I’d like to invite you to try out three free issues of our unique magazine, MoneyWeek.
Each week, we tell you not only what is happening in the world of money, but more importantly — what it MEANS, and how it could affect you.
Most investors will look around with almost no idea how to turn the euro’s demise to their financial advantage.
That’s why we want to tell you about a very simple way to play this deadly trend for potential profit.
It doesn’t come without its risks, but by reading MoneyWeek you’ll learn everything you need to know to help get it working for you.
In fact, I’d like to invite YOU to share in the same vital, timely information that will put you squarely among the country’s investment elite.
I hope you take up our offer…
Because with the financial situation as precarious as it is now, you must tread very carefully if you want your wealth to grow no matter what happens in the wider economy.
While MoneyWeek magazine tries to seek out the best “protect and profit” moves for your money… it also warns you of the big dangerous trends. And the deadly investments coming out of them.
Like this final one… perhaps one of the most widely-owned assets in the UK.
Private investors, pension funds and private client fund managers ALL use it for a big portion of their portfolios.
And yet it could be the single most dangerous tripwire in the market today…and one you must avoid…
AT ALL COSTS.
FINANCIAL TRIPWIRE #3:
The Great Gilt Collapse
Prepare for disaster: When gilts collapse, the UK economy could tumble. Your shares and pension pot could take a battering.
Since the election in 2010, the flow of money into UK government bonds (gilts) has
And in our view, it’s unsustainable.
Of course, it’s easy to see why so many investors have put their money into UK government bonds.
After the credit bubble burst, some investors became wary of the risks posed by stocks. They wanted a safe return. And sure, over the past decade, holding bonds has been a good option.
What’s more, recent global turmoil has made gilts look a comparatively safe bet.
But prices have now been driven up so much that yields are at rock-bottom levels. 10 year gilts, for example, yield just 2.2% — much less than the rate of RPI inflation.
In other words, buy bonds today and you are losing money.
Think about it… would YOU lend money at 2.2% for 10 years to politicians?
No, and we don’t understand why anyone else would.
Or rather, we don’t understand why any sensible investor would. However, perhaps it’s not surprising that gilt yields have been squeezed as low as they have.
After all, the Bank of England is printing money in order to buy them. There’s a huge, price-insensitive buyer of last resort in the market.
It’s small wonder that gilt investors perhaps feel they can’t go wrong. The Bank already owns a third of all outstanding gilts.
But yields simply can’t go a lot lower from here. And when the Bank of England decides to rein in the money-printing, they’re likely to rise at least as rapidly as they fell.
Anyone buying gilts now is taking a lot of risk for very little potential return.
That’s a recipe for investment disaster.
In a nutshell, we believe gilt yields are now as low as they’re likely to get… they have nowhere else to go… and the risk is that bond prices will collapse.
When that happens, you do not want to be holding government bonds.
So, if not bonds…
What should you be doing with your money right now?
Before I tell you, allow me to introduce myself and explain why you should heed
My name’s Toby Bray. And as publisher of MoneyWeek magazine I have the privilege to work with some of the most dedicated writers, analysts and expert financial researchers in the UK.
And I couldn’t think of a better time to have them on your side than now.
Since 2000 we’ve been scouring the financial news — drawing on our many contacts in the City and across the world — to bring our readers right up to date with all the latest investment trends and opportunities.
Time and time again, we’ve stuck our neck out with reports like this one… often going 180 degrees against common opinion.
But it’s been well worth it for our readers, who’ve profited and protected themselves from our past insights. For example:
- In July 2008 we warned sterling was massively overvalued against the yen and the dollar…
In February of that year the pound reached an eye-popping $2.11 — a 26-year high.
But few realised how vulnerable a position we were really in…
In the following months the pound began to collapse.
We even recommended a number of ways to profit from sterling’s fall…
- We saw the credit crunch coming a mile off — and our readers were ready and waiting!
We highlighted the global property bubble and the reckless loans banks were making and warned it could only lead to trouble…
On no less than five different occasions between 2007 to 2008 we explicitly advised readers to GET OUT of the stock market.
Those who listened could have saved themselves a fortune…
- We predicted the price of crude oil was going to surge as far back as August 2002. We told our readers so and identified our favourite oil shares.Readers who acted on our analysis made a whopping profit!
Just take what happened in April 2005, for example.
Richard Tonkinson of Williams De Broe suggested it might be worth looking at three resource shares to play the commodities bull. Those 3 shares — Heritage Oil Corp, Giralia Resources and Uruguay Mineral Exp — went on to make an average 349% gain over the following two years.
Then in April 2006 we predicted oil would “super spike” to new highs. That month we ran a special cover story telling readers exactly how to take advantage.
Of course, as soon as we thought oil’s huge run-up in price was about to end, our readers were the first to know — on that information alone you could have made an 82% gain.
- Starting in October 2006 we published a whole series of warnings that property was about to crash…
It was the height of the property bull… everyone thought it would last forever.
But we’ve learnt over the years that when everyone’s thinking the same, no one is thinking at all.
In the autumn of 2006 we ran a centrepiece on the dangers of free and easy lending to “subprime” borrowers. (This was long before the papers even used the term
But it was in 2007 that we sent out our most urgent and direct warning: “Get out of property NOW!”
The following year the credit markets dried up… property prices fell through the floor… and Lehman Brothers collapsed. We all know what happened next…
Fortunately, our readers had plenty of time to prepare, and shift their money into the opportunities we uncovered.
That’s really our primary goal here at MoneyWeek magazine: to inform you of the best places we think you can save and make money from the markets.
And of course we make sure our readers understand there are risks involved in buying and selling shares – and to never invest more than they can afford to lose.
We tell it like it is, the way we see it — always.
We’re not obliged to promote a certain point of view. We have no bias towards any one asset, stock or sector. And we don’t get a commission by railroading you into any one investment.
Where do we think you should be putting your money today?
Your roadmap to safety and prosperity for the
I’ll be frank…
Right now, many investments look dangerously overpriced.
The wider economic situation still looks very uncertain…
On the one side, you have a whole army of bankers, politicians and economists fighting for a system based on debt and counterfeit money…
On the other, there’s a legion of bad loans created by the credit boom still poisoning the financial system.
The fact is, this crisis is simply not resolved. The bad debt has not been worked out of the economy. And until it’s dealt with, most investments will suffer in the years ahead.
Unfortunately, a lot of people are blind to that fact… and will get financially hurt because of it.
But good investors don’t sit in a state of paralysis during times of upheaval.
So… what should you do?
First of all…
COUNTER MOVE #1:
How to turn China’s looming crash-landing to your financial advantage
First off, we think you need to make sure your portfolio is not overexposed to China’s economic instability.
As I said earlier, there are around 30 shares on the FTSE 100 we think are at risk right now.
But there are ten companies in particular that we believe are extremely vulnerable.
To help you steer clear of the danger, we’ve created a list of the ten shares on the FTSE 100 that we believe are at most risk from China’s impending meltdown right now.
And the sooner you rid yourself of them, the better.
Because we believe there’s a way to turn China’s looming crash-landing to your advantage.
In fact, we’ve uncovered one savvy investment we think could hand you a very sweet profit if China’s mighty economy starts to crumble.
Now is a great time to get this trade working for you. This isn’t one to buy and hold. But if you nip in and out at the right time, it could offer you a sizeable reward.
To get the names of the ten shares we think you need to steer clear of and all the details on the one investment we think could profit from China’s downfall…
Take a free trial by clicking on one of the links at the bottom of this letter.
And that’s just one of the timely investments we’ve prepared for you…
COUNTER MOVE #2:
As the Euro plummets – tap into the one market that could soar!
We expect the euro to hit rock bottom as the problems in the Eurozone continue to worsen over the coming months.
But as the euro weakens, one pocket of Europe could experience a property bubble as a result. I’m talking about Germany.
You won’t find anyone else looking at this right now. But it’s typical of the MoneyWeek team to uncover unloved assets with solid growth potential.
And here’s why…
All the money that’s fleeing every other part of Europe for fear of it being swallowed up in the debt crisis is being funnelled into Germany.
And because German banks don’t want to lend outside of Germany any more (for the very same reason), that money is instead going on special offer to German firms and consumers.
So unlike almost everyone else in the developed world, lending is pretty pain-free for Germans. And as we all know, free and easy lending leads to credit bubbles. German property prices rose by 5.5% last year, after years of stagnation.
This market is under our microscope right now. And in the coming months we’ll be recommending a way you can steal in early on Germany’s coming property boom.
To make sure you don’t miss out on this clever way to play the downfall of the euro, why not try three free issues of MoneyWeek?
We have our eye on one overlooked fund that could be set to soar if things play out as we expect.
And when it’s time to get in, make sure you are the first to know.
Simply scroll down to the bottom of this letter to claim your free trial.
But before you do, make sure you’re well positioned to…
COUNTER MOVE #3:
As gilts fall, ride gold all the way to a possible $2,230… or even more!
Here at MoneyWeek we first recommended our readers buy gold in November 2001.
Back then it traded for under $290 an ounce.
Today it’s around $1,650.
That’s an incredible 468% rise.
And of course it begs the question… is gold still a “buy” today?
Our opinion is simple: Yes. I’ll show you why. But first, consider this…
Since the start of the last decade, just holding gold would have quadrupled your wealth
It makes you wonder, how many thousands of hours did stock analysts slave away in the walls of the Square Mile?
How many hedge-fund managers crunched numbers late into the night?
And how many billions of pounds got blown on financial advisory fees… before somebody figured out that this one simple move could beat them all?
From 1999 until now, all you had to do was own gold — and without the help of a single fund manager or expensive advisor, you could have more than quadrupled your wealth.
And that’s one of the crucial things we at MoneyWeek advised our readers
Impressive? Go back over the last 25 years and you’ll find something even
…the single best year for stocks produced only a 31% gain.
…while gold had a year with gains of 100.2%.
…and precious metal coins topped the charts at 198.8%!
Now I’m sure you’re asking, after such a run, is this already over?
No. In fact, we think it still has a long way to go yet…
Why we see gold climbing higher still
Gold: The bull market has much further to go
In times of crisis, investors tend to flock to gold…
And in the face of the UK’s possible Gilt collapse, we think right now is the perfect time to stock up on the precious yellow metal.
During the 1970s and early 80s, the yellow metal soared 2,329%.
We’re not even a fraction of that move today — at around just 500% in gains since 2001.
Remember, we’re predicting a lot more turmoil in the markets, a crashing euro, and the downfall of one of the world’s biggest economies.
A lot of people are going to look for safety. And in the world of investment, there’s nothing more comforting than having your money stored in gold. So we expect demand to take a big upswing.
If gold was to rise today from trough to peak by the same percentage move as it did in the 70s… you’re talking an eye-popping gold spike to $23,450 per ounce.
Now, we’re not saying it will go anywhere near that high.
In truth, we pray it won’t.
Because to see that happen, all hell would need to break loose.
But the fact is… today, we’re locked in a period of intense confusion.
And that’s why gold is headed up, in our view.
We can’t predict the future and as you are fully aware, the price can go down as well as up.
In fact, in the short term it may waver… but our expectations are that you will look back in 12 months and be somewhat shocked by its steep climb.
Recovery, some say, will boost consumers’ appetites, resulting in higher inflation and a higher price for gold. If we fall back into recession, say others, central banks will print more money and gold will rise anyway.
In short, if the economy improves, gold rises naturally. If it doesn’t improve, the authorities will force it up.
Either way, we think gold will go much higher than it has so far.
Adjusted for inflation, the 1980 gold peak of $850 gives you a price of $2,230 still on the horizon today.
That’s more than enough for you to make a potentially huge profit on the next gold move.
But it could go higher still.
And right now some of the world’s most renowned gold experts agree.
That’s over 360% higher than where it trades today.
You get that number by divvying up all the $2 trillion of new cash out there… by all 261.5 million ounces of gold the US government claims to have in reserve.
The question is: which gold investments should YOU be buying today?
The Gold Profit Plan
For years, we’ve urged MoneyWeek readers to get into gold and silver.
We’re still urging them to buy in now.
And by far, the best thing we think you can do — not just in this market but always — is have your own well-protected stash of physical gold. Because it’s easy to trade and portable, the government can’t touch it and you know it’s there.
This is a top priority and something we show you how to do smartly, easily, and safely…
Yours FREE for trying out MoneyWeek for the next three weeks!
In fact, that’s why we commissioned our resident gold expert to explain the full case for gold for you today.
This special report, Why you should buy gold now, is like a complete “gold profit plan” that reveals the best ways you can capitalise on our predicted run-up in the yellow metal.
Best of all, this report can be yours FREE, right now, simply for trying three free issues of MoneyWeek.
Here’s a glimpse of what you’ll find inside this special report:
All this is yours, FREE, simply for trying out MoneyWeek magazine for the next three weeks, without commitment.
But the truth is… that’s just the start.
Because there are a number of incredible ways to make the most out of this bull market in gold…
And if you try three free issues of MoneyWeek, you’ll also hear about our top gold ETF picks trading on the markets right now… and of course, what we see as the real profit opportunity in the coming months: GOLD STOCKS.
To get all our insight on the gold bull, simply sign up for your 3 free issues at the bottom of this letter — and remember, the special report on Why you should buy gold now is yours too (again, absolutely free).
As you’ve seen, it couldn’t come at a better time…
How to protect and potentially profit whatever happens
Right now, millions of investors don’t understand the severity of the UK’s current situation.
They see the events of the past three years and think the worst is over. Some even feel relatively untouched by what’s happened so far…
But they could be in for the shock of their lives.
As I’ve said, we believe caution is vital. Because the threats posed by the three tripwires are in the here and now.
In fact, you may already have stumbled into them. If that’s the case, we believe you MUST do something about it URGENTLY.
And that’s why MoneyWeek can help you, the private investor, like no
You will receive the very best financial information at exactly the right time to make all your investments count.
Plus, through MoneyWeek, the very best financial minds will tell you what they think you should do to protect yourself from the threat of slumps and crashes, while most private investors are left vulnerable.
No more wading through every newspaper, magazine, TV and radio story trying to sort through conflicting financial advice…
No more endless hours looking through reports to get to the bare bones of a stock market opportunity…
And no more worrying about what the government and our financial authorities may or may not do next…
Now you can protect your wealth — and potentially profit — whatever happens…
Starting with the report I’ll send you to help you avoid the three most dangerous tripwires for investors right now…
100% FREE when you take up our no-obligation trial offer!
To start your free trial – click here now.
With MoneyWeek magazine all that hard slog, expense and worry can be a thing of the past
I’d like you to be one of the few people in the UK to try MoneyWeek for yourself… for a special FREE trial.
If you accept this free trial offer, you’ll be in very good company.
MoneyWeek has already helped so many investors (from the novice to the experienced), just by cutting out all the dross and bringing you the right investment insight at the right time, with no hidden agenda.
We don’t profit from our tips, we’re not paid to plug an investment.
We’re beholden to no one except you – our readers.
The tips, insight, articles and advice you’ll find in every packed issue of MoneyWeek have one aim only — to help you build real wealth and become financially secure.
Here are a few of the private investors that you could soon be joining:
|“I have saved myself loads of money on my pension fund following your tip-offs… and I even got some gold coins from ATS Bullion, before they had their mini-gold rush! Everyone is impressed… Thanks again. I have just retired and I feel confident with the help of MoneyWeek and Money Morning.”
“Without [your magazine] and your daily e-mails I would have suffered greater losses through these challenging times… Also I’ve been able to help family and friends with sound advice in this current climate. As for the future I feel confident I can weather the storms ahead far better with the knowledge I have gained from MoneyWeek.”
Tony Le Grange, Southampton
“I have to hand it to you… you have forecast everything during the downturn and none of this is vaguely a surprise to you.”
Bob Lindo, Camel Valley Vineyards, Cornwall
“I knew precious little about economics – but I now feel I am quite an expert – especially compared to my friends and family who are still ‘a bar behind’ because they don’t read MoneyWeek!”
Rachel Smith, Croydon, Surrey
“This is simply a note of thanks to you and your staff in providing a publication that has personally guided me into safer financial waters during this time of uncertainty.”
Simon Bradley, Bournville, Birmingham