“Sell Your Bonds Now!”…
When This Bond Bubble Finally Ruptures it Will Completely
Blindside Everybody – Except YOU!
Plus 3 Simple Strategies You Can do Right Now
To Protect Yourself AND Make a Killing when (not if) it Really Hits the Fan…
Truly, we live in confusing times…
Are we out of recession and on the road to recovery…. is the stock market going up or down. Where will oil bottom out? Are doing ok, or in it up to our necks and heading for a double dip that will be far deeper and more painful than the first?
Certainly the government and Wall Street are doing their best to convince you that the financial storm has passed.
But just last week, independent rating company Egan Jones announced that the National Debt has finally hit the inflection point.
In other words our debt to GDP ratio has reached 100%.
As of right now we owe as much in debt as we make in all our industries, manufacturers, services and retail put together.
Make no mistake, that puts us right up there with Italy and Greece!
With challenges like this, can we really get through the debt crisis and come out the other side a stronger more powerful nation?
Or could eventual bankruptcy really relegate us to a world power ‘has been’… Chinas new lapdog?
No, we’re not in the same perilous ‘basket case’ state as some of Europe’s nations.
But we’re fast heading that way. And Washington doesn’t seem to be willing or able to fix things.
And yes, I know the stock market continues to rise,
But it’s an illusion.
It’s not wealth creation but market manipulation.
As long as the fed sets rates below the rate of inflation, pours liquidity into the financial system and swaps $2.3 trillion in brand new dollars for a shed load of toxic assets with all those new dollars propping it up, how would it drop?
And there’s another major problem looming. Bigger than a stock crash, harder to foresee than a bank collapse.
And it is NO illusion.
It will affect the livelihood of millions of Americans. Because when it starts, those who have done nothing to protect themselves will be helpless.
Most won’t see it coming, so when it arrives, it will simply be too late to do anything to defend themselves.
They’ll watch their savings evaporate in the fog of the most cataclysmic financial event of their lifetime.
And there will be nothing they can do to stop it.
If this sounds over dramatic, let me be clear;
Not the great depression, nor the housing bubble, not even the crash of 2008 will remotely compare to the hurt this will bring.
It will be so destructive that it will wipe trillions from our savings and from the value of American companies.
Banks, the ones that are ‘too big to fail’ will fail spectacularly.
It will decimate what’s left of our retirement funds and even herald the end of our nation as a Super Power.
I’m talking about a rapidly-inflating, out of control and completely unsustainable bubble…. in the US bond market.
Do You Have Bonds in Your Portfolio?
Let’s keep it simple.
Right now Bond investments are extremely attractive to investors, so they are being driven to irrationally high prices.
Investors don’t want to be left out.
Just like Tulips, Dotcoms and affordable housing, as always, the bubble effect kicks in.
Investors want in.
And even though they’ll have to pay ridiculous prices, they pay, and push prices up even more.
For a while it all looks rosy.
But at some point – and often practically overnight – the ridiculously high prices become suddenly extremely unattractive to those same investors.
It’s always the same with a bubble.
Suddenly, everyone wants out. And the investment that held so much promise, collapses.
And this is a text book description of exactly what’s happening right now in Bonds.
Immense pressure is building up under our bond market.
Investors are piling in, driving prices higher, pushing the bond hard, creating an unavoidable bubble.
There’s no way to pinpoint the time, but like a pressure cooker left on the gas too long, this quickly-growing bond bubble will crack, rupture and finally blow up in our faces.
And that could be all that’s needed to push your investment portfolios over the cliff.
All it’s going to take is for the market to get the whiff that today’s unprecedented low interest rates are turning around, heading higher – as they inevitably must.
The story doesn’t even have to be true. Rumors crash markets just as effectively as actual events.
Truth, rumor, whatever, a pop is still a pop.
And this one will be a killer.
So what can Bondholders do to protect themselves? ….
My name is Bud Conrad, I’m neither a doomsayer nor a recovery pundit.
I’m an Economist, a Harvard MBA, a frequent contributor to major business media such as The Wall Street Journal’s MarketWatch, International Business Times, Fox Business News, and others.
I’m also the author of “Profiting from the World’s Economic Crisis”
My unique position and over 30 years the financial sector allows plain and simple facts to show me where the economy is likely to go next.
You can be sure that as I have no political agenda, what I show you next is the real story, unedited.
Sometimes you won’t like what I have to say, but you need to hear it to stay safe.
From that perspective it is clear there are very difficult times ahead.
However, I’ll also show you three opportunities you can take care of immediately to protect yourself from the inevitable bond bubble.
But, what if I’m wrong?
Well, no-one has a crystal ball.
In the US, policies might change. Obama could stay or go, who knows?
And the trigger may not even start here in the US.
Europe might unravel completely. Especially now as I write this that Greece is in political deadlock with no one party in power.
France too has voted into power a socialist government that aims to turn their back on the austerity measures put in place.
In Germany support for Merkel’s party plunged to 26.3$ from 34.6% in 2010.
That represents her party’s worst showing since World War II.
It’s a clear sign that the Germans are sick of bailing everyone out.
If Germany pulled out of the euro tomorrow, the euro would simply disintegrate.
Bond yields for the rest of the eurozone would skyrocket to unparalleled heights.
Without German bailout money, troubled nations such as Greece would be headed directly for default.
Right across Europe, incumbent governments are being forced from power. The Netherlands, the UK, Spain, Ireland, Italy, Portugal and Greece.
Whenever they get a chance, the citizens of Europe are using the ballot box to send a message that they do not like what is going on
In Europe it seems, no-one wants to pay their debts and they are running out of options very fast.
Everything is connected, the complexities of the countries companies, pension funds and individuals holding our bonds are immense.
These, or any other single event closer to home could trigger a bond collapse.
It could start in Europe, and head here, or the other way around, it doesn’t really matter, whatever way it stacks up, it will be huge.
So if you hold bonds, what should you look for?
Well that’s the problem.
You remember the Lehman collapse, how it took everyone from the man on the street to Major Wall St players and the Government completely by surprise?
One minute, everything’s fine. The next, bam….trillions of Dollars were wiped out across huge swathes of America.
The Bond bubble will be no different.
And I believe that in the U.S. we have an arrogance of wealth that simply blinds us to possible problems.
We’ve been so sucked in to debt and consumption that we refuse to believe it will happen.
Until it does happen, and by then it’s too late.
We are now at record low rates and the government deficit is at such extremes that rates can only go up.
I don’t know how it will all unravel, but there is no way out for the bond market.
So yes, I might be wrong. Though with every relevant indicator and over thirty years of experience telling me I’m right, I’m saying today that it’s simply best to be safe, and out of them completely.
So what’s the alternative?
END OF LEAD