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Just 10 days from now, on November 1st, the Federal Reserve is likely to start on a whole new round of sharp rate hikes which could set off a far wider storm. They have no choice. Inflation is starting to surge out-of-control. Other countries are already upping the ante and raising their interest rates, making the U.S. dollar vulnerable to a sharp decline. So Greenspan must raise rates on November 1st, and he must do so aggressively. For most investors, this means another cost is about to rapidly start rising. In addition to energy prices and other natural resources that are jumping wildly, the cost of money is going to head much higher. Ive helped you prepare for the consequences by warning you to lock in fixed interest rates on variable mortgages and other debts, or pay them off entirely. If you followed my recommendation, youre also protected from the impact on the stock market. You have the bulk of your funds safe and youre seriously considering some of the bear market insurance I told you about yesterday. Now, lets talk about … How to Turn Rising Interest Rates Just in the last three weeks, options that tied to interest rates literally went through the roof. Based on a tiny, relatively insignificant rise in interest rates, some of these options gained 60% … 94% and 206% in as little as 7 days.
For example, just a few days ago, on October 11, one interest-sensitive option were tracking, opened the trading day at a price of $531. By the close of trading three days later, on October 14, it was worth $1,428 or nearly three times more. And that was even without a Fed rate hike. So you can imagine whats possible if the Fed embarks upon a more aggressive campaign to raise rates, as I believe it will have to. If Im right and interest rates rise as I expect them to, a single investment of as little as $1,000 to $1,500 could be built up into $15,000 to $20,000. If you started with three of them (your cost: no more than $4,500), youd have as much as $50,000. If Im only halfway right, you could still see excellent gains — such as the 60%, 94% and 206% I just told you about. And even if Im completely wrong about interest rates, you have a safety net: Because of the unique characteristics of options, the most you can lose is the amount you invest, plus any commissions you pay your broker. Are losses possible? Absolutely! You cannot swing for home-runs without also accepting the possibility of strike-outs. But this is an investment that lets you sleep at night and yet can make you a genuine fortune. Never Before Have I Seen Such a Powerful We stand at a unique crossroads in our history. We have a bulging budget deficit, a sinking trade balance, and wild, debt-driven speculation among banks, consumers, and even governments. We have some of the biggest bull markets of all-time in commodities such as oil, gas, copper and many more. And, as you just saw this week, we also have the biggest monthly jump in prices in a quarter-century! All of these forces are pressuring interest rates higher. And all are coming together at the same time. But right now, interest rates are still not far from their 45-year lows! In all my 35 years of studying the interest-rate markets, Ive never come across such a powerful convergence of forces. Use This Convergence of Powerful Heres what I have in mind. First, I am ready to send you a detailed explanation of those remarkable, interest-sensitive options that you can use to build $4,500 into $50,000 as rates go up. For optimum profits, I generally recommend a variety of closely related — but different — options with varying expiration dates and strike prices. Ill explain what they are, how to buy them, and how much to pay for them. And in case youre not experienced with options, Ill include an explanation that begins with the basics and covers everything youll need to make this really work for you. Second, follow-up. Most analysts give a recommendation but dont do the necessary homework to make sure you can really act on it. I will tell you when to get in, when to get out, and when to roll over your positions to give you more time if you need it. On each and every investment, Ill tell you, ahead of time, the reasons I think this is a great opportunity for you, what the risk is, and what your profit potential is. Then Ill keep you posted on any changes so youll always have specific instructions. Im talking about an elite service of e-mail alerts that has no ambiguity, ifs, buts, wherefores or other weasel phrases so many analysts use to protect their you-know-whats. My alerts always go out by e-mail because instantaneous communication is essential for good fills in these fast-moving markets. Third, Ill send new recommendations as soon as I spot new opportunities. Youll get a minimum of 15 recommendations per year, probably more. Right now, interest-rate options are my main focus because Im convinced major fortunes are going to be made here relatively soon, and I think its going to start happening within days. But interest rates reach directly into other markets, such as interest-sensitive stocks. So one of my next recommendations may be put options on a major bank thats about to get clobbered by rising rates. For example, I believe the shares in J.P. Morgan are on the brink of collapse. This bank is loaded with bonds and mortgages that are already falling in value. Its also got the largest portfolio in the world of high-risk investments called derivatives. And many of these are going to take a beating if the Fed shocks the market with a larger-than-normal rate hike. Our subscribers have already seen a long string of nice, hefty profits with put options on smaller banks and lenders that have taken hits in recent weeks due to rising short-term rates. Now, as long-term rates rise, I figure its going to be the big banks turn to see their shares get clobbered. Another major opportunity is coming in options on currencies. This is one of the markets thats most directly impacted by changes in interest rates, especially changes of this magnitude. So for occasional diversification and some other great profit opportunities, my service also covers this area. Our goal: To use our knowledge of interest rates every way we can to help you make money. Fourth, timing. You get my recommendations precisely when — and only when — I see a major, first-rate opportunity for you. I believe that when the opportunity pops, you have to grab it then and there. Thats why my recommendations do not conform to a regular publication schedule. You will get a wrap-up issue every week no matter what. But the recommendations can come out at any time on any day of the week. The recommendations will be sent to you by e-mail, complete with a detailed explanation of why Im recommending it, how to buy it, how much to pay for it, what special warnings — if any — are necessary and, of course, when to take profits and sell. Then its up to you to pull the trigger. Interest Rates Are Not The next Fed Reserve meeting is on Tuesday, November 1st — just 10 days from now. One way or the other, interest rates are going to start moving up.
In 1980, the last time inflation was exploding like this, the 3-month Treasury bill rate catapulted from 6.3% to 16.7% in less than six months. I dont think rates will go up that quickly this time around. But even if they go up only half as fast, the opportunities in interest-rate options are tremendous. With the upward pressure on interest rates now so powerful, moves that normally take years could be over in a matter of months. So to take advantage of the situation, I feel you must have your options in place, sitting there before the market starts to move more rapidly. 1,000 Members Is Our Limit The name of the service is Interest Rate and Currency Trader. The regular price is $5,000 per year. However, since I want to encourage subscribers to get on board before the Feds next meeting on November 1st, I am offering two years for the price of one. Subscribe at the regular rate of $5,000 for the first year, and you will get the second year free. That cuts your cost in HALF and saves you $5,000! And no guarantees, but I expect the first recommendations to pay several times the cost of the service. But, heres what I can guarantee: If you wish to cancel at any time in the first year, for whatever reason, you will receive a pro-rated refund on the balance of your subscription. We already have 460 subscribers to my interest rate trading service. I fully expect the remaining slots will be sold out very soon. Once these remaining slots are gone, thats it. Unless you want to be placed on a waiting list, any additional checks will be sent back. I dont want to disappoint you. If you want to become a subscriber, its critical that you send in your subscription fee now, before we run out of the available slots AND BEFORE THE NEXT FEDERAL RESERVE MEETING ON NOVEMBER 1st! To make sure, I suggest you pick up the phone right now and call Doris at 800-815-2917 … or order online on our secure site. Our next recommendation will probably go out early next week to make sure we are positioned before the market starts anticipating the Fed action. So to make sure youre on board in time, be sure to get your order in by midnight Sunday. Despite Hurricane Wilma, we will make sure we have someone to take your call until late Sunday. And even if its after hours, our computer is always ready for your online order. Best wishes,
P.S. Warning: After the first 1,000 subscriptions to Interest Rate and Currency Trader are received, all future orders will be returned. We do it reluctantly — we hate rejecting $5,000 orders — but it must be done. Some of these investments have clear liquidity limits. We have to limit the number of investors to help make sure you can get good fills on your orders. About MONEY AND MARKETS MONEY AND MARKETS (MAM) is published by Weiss Research, Inc. and written by Martin D. Weiss along with Larry Edelson, Tony Sagami and other contributors. To avoid conflicts of interest, Weiss Research and its staff do not hold positions in companies recommended in MAM. Nor do we accept any compensation for such recommendations. The comments, graphs, forecasts, and indices published in MAM are based upon data whose accuracy is deemed reliable but not guaranteed. Performance returns cited are derived from our best estimates but must be considered hypothetical inasmuch as we do not track the actual prices investors pay or receive. Contributors include Marie Albin, John Burke, Michael Burnick, Beth Cain, Amber Dakar, Scot Galvin, Michael Larson, Monica Lewman-Garcia, Julie Trudeau and others. 2005 by Weiss Research, Inc. All rights reserved. |
New Market Shock in 10 Days!
Hurricane Wilma is expected to make landfall here in Florida this weekend. But thats not the storm Im most concerned about.
Either Greenspan starts raising them at a faster rate … or bond investors in the U.S. and abroad, disgusted with the inflation, are going to start selling, driving rates higher.Previous post: The New, Old Bear
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