A Corporate Debt Crisis Is Underway… And Nobody Cares

A Corporate Debt Crisis Is Underway… And Nobody Cares By Justin Spittler Investors no longer give a damn. That might sound harsh, but when things are this backwards, you have to tell it like it is. You see, I read something recently that disturbed me. I had to pinch myself to make sure I wasn’t dreaming. It was an article I recently stumbled upon in Bloomberg. In it, the author explained how U.S. companies are issuing debt at breakneck speed. You see, U.S. companies have already issued more than $360 billion worth of investment-grade bonds just this year. Corporate America is now on pace to issue the most investment-grade debt in the first quarter since 1999. I don’t have to remind you how that ended… But here’s the really crazy part… Investors are lining up around the block to buy these bonds. If you read yesterday’s Dispatch, you know where I’m going with this. In short, the bond market is unraveling. This isn’t some conspiracy theory. It’s a fact. And yet, investors are buying bonds by the fistful. These people don’t understand how much danger they’re in. Hell, they don’t even know what they’re buying anymore. I’ll explain why in a second. But first, let’s be clear about what “investment-grade” means. • Investment-grade bonds are bonds issued by companies with good credit… They’re the best corporate bonds money can buy. Investors like them because they’re supposedly “safe.” Conventional wisdom says you can own them and sleep well at night. At least, … Continue reading

This Sector Is Set to Deliver 20-to-1 Returns… and That’s Just From the “Bad” Companies

This Sector Is Set to Deliver 20-to-1 Returns… and That’s Just From the “Bad” Companies By Nick Giambruno “It was the single most important financial event of my career.” That’s what my friend Rick Rule of Sprott Global recently told me of his experience in the uranium market. Rick was referring to Paladin Energy, a uranium company that leaped from one penny to $10 per share during uranium’s last bull market. That’s a 1,000-fold increase. In other words, a $1,000 investment could have exploded into $1 million. Even the worst-performing companies in the uranium sector delivered 20-to-1 returns. Uranium can deliver these almost unbelievable returns because of unique supply-and-demand quirks that create colossal bull and bear markets. Here’s a quick rundown… and a closer look at how uranium’s coming bull market could hand you these kinds of life-altering profits. The 1950s Uranium Bull Market Uranium cycled through its first bull market in the 1950s. This bull was mainly driven by the nuclear arms race between the US and the Soviet Union. Back then, the only practical way an investor could get exposure was through uranium exploration companies trading on small regional stock exchanges, like the one in Salt Lake City (which closed in 1986). Those who did made a bundle. The Late 1970s Uranium Bull Market The uranium price increased more than tenfold during this bull market… from $3 to $43. Some uranium stocks shot up by a factor of 100. Greater nuclear power use was the main driver. It … Continue reading

How to Double Your Money 94% of the Time…

How to Double Your Money 94% of the Time… By Justin Spittler Editor’s note: Today, we’re taking a break from our usual commentary to share a must-read piece with you. In the essay below, International Speculator editor Louis James pulls the curtain back on a money-making phenomenon. As you’ll see, this strategy has generated average gains of 133%. More impressively, it works almost 100% of the time. This is the first time we’ve shared this powerful secret with our readers. We hope you find this essay as eye-opening as we did. What would you say if I told you of an investment strategy that more than doubled your money within two years, 94% of the time? First, a confession. I’m about to tell you something that’s rather obvious. The phenomenon is well known. Despite that, I never did the math before. To my knowledge, no one has ever bothered, but that’s no excuse. So, while I knew it was a factor—I’ve even made recommendations to profit from it—I didn’t realize just how powerful this approach is at generating maximum gains for minimum risk. Albert Einstein was famous for urging us to question everything. He once said, “I have no special talents. I am only passionately curious.” The strategy I’m about to describe has been “hiding in plain sight.” Doug Casey told me about it when I first started working for Casey Research. But I never asked: “What’s the average gain?” My apologies. Now, let me explain. Do you remember the … Continue reading

Weekly Bulletin: The Rally of 2016—Over or Just Getting Going?

  BULLETIN October 10, 2016 Weekly Bulletin: The Rally of 2016—Over or Just Getting Going? Dear Speculators, Last week’s 4.5% retreat in gold prices hit gold stocks hard. The VanEck Vectors Gold Miners ETF (GDX) dropped about 11.5% and the VanEck Vectors Junior Gold Miners ETF (GDXJ) about 13.5%. This share price action is normal: Resource stocks always move with high leverage to the underlying commodities. What may seem abnormal, but has been par for the course for some years, is for the paper gold market to overreact to verbal testing of the waters by the Fed. Nothing has actually changed. Still, paper traders in New York reacted to a few hints from Fed members as though they’d dropped a hornet’s nest in their midst. We’ve seen this so many times it’s no surprise, but it still makes us shake our heads. Remember: Initial rate hike target for this year: 4 Revised rate hike target for this year: 2 Actual rate hikes this year: 0 And what happened when the Fed did raise interest rates, ever so timidly, last December? Mainstream markets tanked in January. Precious Metals took off for what is still one of their best years in recent memory. So if I say I see the current correction as a buying opportunity, don’t dismiss it as me just being a perma-bull on precious metals. I’m not. I’ve been warning of the potential for near-term weakness for some time. I’ve been insisting that we take profits and go risk-free whenever we can … Continue reading

Doug Casey on the Migrant Crisis

Doug Casey on the Migrant Crisis By Nick Giambruno Nick Giambruno: The migrant crisis is tearing Europe apart. What’s your take Doug? Doug Casey: I’m all for immigration and completely open borders to enable opportunity seekers from anyplace to move anyplace else. With two big, critically important, caveats: 1) there can be no welfare or free government services, so everyone has to pay his own way, and no freeloaders are attracted 2) all property is privately owned, to minimize the possibility of squatter camps full of beggars. In the absence of welfare benefits, immigrants are usually the best of people because you get mobile, aggressive, and opportunity-seeking people that want to leave a dead old culture for a vibrant new one. The millions of immigrants who came to the U.S. in the late 19th and early 20th centuries had zero in the way of state support. But what is going on in Europe today is entirely different. The migrants coming to Europe aren’t being attracted by opportunity in the new land so much as the welfare benefits and the soft life. For the most part they are unskilled and poorly educated. What we’re talking about here is the migration of millions of people of different language, different race, different religion, different culture, different mode of living. If you’re an alien and you’re 1 out of 10,000, or 1,000, or 100, you’re a curiosity, an interesting outsider. But an influx of millions of migrants is only going to destroy the old … Continue reading

Where to Buy Property Without Paying Property Tax

Where to Buy Property Without Paying Property Tax By Nick Giambruno Do you really own something if the government forces you to make never-ending payments on it? I think the answer is “no.” You possess such an item, but you don’t own it outright. It’s an important distinction. A ridiculous threat to property rights has infected most of the world like a virus. Most people unquestioningly accept it as a normal part of life—like gravity or the sun setting in the west. The threat I’m talking about is property tax: that annual tax you pay whether or not your property generates any income. Instead, the government bases the tax on the underlying value of real estate you supposedly own. There is no way to pay off this obligation in one fell swoop. It hangs over your head as long as you hold title to the property. For practical purposes, you don’t really own anything you have to pay an annual property tax to keep. You are merely renting from the government. Suppose you bought a sofa set and coffee table for your living room for $5,000 cash and then had to pay a $100 tax each year for as long as you “owned” the furniture. Then suppose, for whatever reason, you’re unable or unwilling to pay the furniture tax. It wouldn’t take long for the government to swoop in and confiscate your furniture. In this case, you “own” the furniture as long as you pay the never-ending annual fee—stop paying and you’ll find out who really … Continue reading

Five Ways to “Crash Proof” Your Portfolio Right Now

Five Ways to “Crash Proof” Your Portfolio Right Now By Justin Spittler The U.S. economy is running out of breath. As you probably know, the U.S. economy has been “recovering” since 2009. The current recovery, now seven years old, is one of the longest in U.S. history. It’s also one of the weakest. Since 2009, the U.S. economy has grown at just 2.1% per year, making this the slowest recovery since World War II. Last quarter, the economy grew at just 1.1%. We won’t know how the economy did during this quarter until late October. But we don’t expect good news, and that’s because signs of a stalling economy are everywhere. • They’re in the job market. The U.S. economy created 29,000 fewer jobs last month than economists expected. • They’re in corporate earnings. Profits for companies in the S&P 500 have been falling since 2014. • They’re even in the price of oil. Right now, U.S. demand for gasoline is weak, which tells us Americans aren’t driving as much. Today, we’re going to look at even more evidence that the economy is struggling. If this flood of bad economic data continues, the U.S. could soon enter its first recession in seven years. Normally, this wouldn’t worry us. After all, recessions are a normal part of the business cycle. But we don’t expect the next downturn to be a “run-of-the-mill” recession. According to Casey Research founder Doug Casey, the next financial crisis will be “much more severe, different, and longer lasting than what … Continue reading

This Important Chart Shows Why Gold Could Hit $6,000 by 2019

This Important Chart Shows Why Gold Could Hit $6,000 by 2019 By Justin Spittler Editor’s note: Today, in place of our usual market commentary, we have another important essay for you from International Speculator editor Louis James. Last week, Louis explained why it’s not too late to get in on the big gold boom right now, saying “I think we’re all about to make a pile of money.” Today, he shows you just how high gold could go as this bull market gains momentum. As you’ll see, right now is the ideal time to own gold stocks… Dear Reader, “You’re crazy, buying gold now!” That’s what one of my students said to me in the summer of 2008. I was teaching one of my seminars on entrepreneurship, that time in the Republic of Georgia. Gold had risen for seven years and was trading around $800 per ounce. This student was a very bright Azeri fellow, business savvy and economically astute. But also a product of his education. He said it was foolish to buy gold, which had no real use, when it had become so expensive. I told him, and the whole class, to watch what happens to gold when everything almost everyone thinks they know about economics gets called into question. They had that opportunity a few months later, in the crash of 2008. As you may recall, gold initially took a hit. There were margin calls and fund redemptions left and right. Jobs disappeared and money vanished into … Continue reading

Why Doug Casey Thinks We Could See $5,000 Gold

Why Doug Casey Thinks We Could See $5,000 Gold By Justin Spittler One of the world’s biggest central banks just swung its “sledgehammer.” On Thursday, the Bank of England (BoE) launched its biggest stimulus package since the 2008–2009 financial crisis. It cut its key interest rate to a record low. It started “printing” money again. And it announced a new “funding scheme.” The BoE launched this massive easy money program to soften the blow of the “Brexit.” As you probably heard, Britain voted to leave the European Union (EU) on June 23. The historic event rattled Britain’s financial system. The FTSE 100, Britain’s version of the S&P 500, fell 3.1% on the news. It was the worst day for British stocks since 2008. The pound sterling, Britain’s currency, plunged 8%, its biggest one-day drop on record. In the aftermath, many analysts predicted Britain’s economy would take a serious hit. Some even warned of a recession. The BoE sprang into action to prevent this. Today, we’ll show you why the BoE’s “sledgehammer stimulus” program won’t work…why it could steer Britain’s economy off a cliff…and why it’s great news for gold. But first, let’s take a close look at what’s happening in England… • Britain’s economy is headed for a major slowdown… Shortly after the Brexit, credit rating agency Standard & Poor’s (S&P) said Britain’s economy could slow by as much as 1.2% next year. Britain’s economy is currently growing at an annual rate of 2.2% per year. Investment bank Goldman Sachs (GS) … Continue reading