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While our federal deficit explodes and U.S. stocks sink, I’ve been actively meeting our readers on my personal blog to share ideas on how to build the optimal growth portfolio in trying times like these.
We’ve examined all five of the major asset classes — stocks, bonds, currencies, precious metals and commodities — to sort out which ones we believe will sink and which will surge going forward.
We’ve seen how Wall Street analysts, whether using fundamental or technical analysis, utterly failed to warn investors of the two most devastating crashes of our lifetime — the Tech Wreck of the early 2000s and the Housing Bust of the late 2000s.
And on Friday, I asked,
Can you EVER trust Wall Street to anticipate major market turns? If so, when? Are they now leading investors into a brand NEW trap?
I admit: I knew the question would get a rise out of our readers — and I was right. The consensus …
“Trust Wall Street?
ARE YOU PULLING MY LEG, Martin???”
Our readers are 100% correct, of course.
According to the Federal Reserve, trusting Wall Street’s recommendations to buy tech stocks at 500 to 1,000 times earnings cost investors $6.6 trillion when the tech bubble burst in 2000.
And according to the Fed’s latest figures, trusting the housing boom that Wall Street and Washington created cost investors another $15.5 trillion in 2007-2009. In sum …
So far in the 21st century alone, Washington
and Wall Street have caused combined losses of a
staggering $22.1 TRILLION of investors’ money!
Worse, it looks like an even greater threat to investor wealth could now be emerging.
Remember what I wrote here this past Monday morning: That the next big contagion was about to strike Wall Street.
Sure enough, it struck this past Thursday. Not only did the Dow and Nasdaq plunge … but the very country where the contagion first began — Greece —sank into an even deeper abyss in the wake of a strike that paralyzed its ports.
Meanwhile, we reported that Moody’s has effectively announced that our nation’s future credit rating is in danger of being slashed, barring one of two miracles:
MIRACLE #1: This tepid — and possibly failing — economic recovery miraculously catches fire, exploding corporate profits, personal income and federal tax revenues, or …
MIRACLE #2: The Obama administration and Congress suddenly make an about face and embark on a dramatic budget-slashing campaign.
My view: Anyone who holds their breath waiting for either miracle is going to be severely disappointed.
The bond market bubble — third great bubble of the 21st Century — is going to burst. Trillions more dollars are about to vanish into thin air when the bond market collapses into a heap of rubble.
So what’s an investor to do?
Is there a practical way to build a growth portfolio that not only diversifies your money across the asset classes most likely to surge in this environment but also protects your money like a junkyard dog?
Watch your inbox tomorrow for my answer.
Good luck and God bless!
Martin
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