Martin here, with an urgent update on overseas stock markets.
If you think their rise has slowed or ended, look again!
After a minor correction in January, China has turned sharply higher.
Singapore has been surging nearly non-stop since May on its way to becoming one of the best performers in the world.
And Brazil is blasting to new record highs with some of the heaviest trading volume ever, just this past week.
Meanwhile, despite the fact that the U.S. market has made new highs, it’s still lagging far behind — with no sign of acceleration, no new hope for distressed industries like autos and housing, and virtually no chance of catching up with Asia or Latin America.
Yes, the S&P 500 was up 13.6% last year. But that was lame in comparison to the markets our editors and I have been writing you about ever since we published our first Money and Markets five hundred and twenty-six issues ago:
Steve Chapman, a guest editor representing our affiliate money management company, told you about Eastern Europe. Sure enough, Poland was up 41.6% and Russia, 92.5%.
Larry Edelson told you about the opportunities in China and Vietnam. Result: China was up 131% and Vietnam rose 144.5%.
I told you about Brazil, up 32.9%.
Tony Sagami brought you new opportunities from all over Asia.
And Sean Brodrick gave you uranium companies from Australia and Canada, up by an average of more than 70%.
How did we do it?
I can assure you we’re not soothsayers. But we’re also not ivory-tower theorists.
We went personally to the countries we recommended. We analyzed the practical realities on the ground. And we sent you back our reports from the field with no ax to grind, with no punches pulled, and with plenty of time for you to act well before these huge market rises you’re seeing now.
If you ignored us then, we totally understand. It was new. And maybe you weren’t quite ready.
But that should no longer be the case. Now all those opportunities we told you about are unfolding before your eyes. Now, the vehicles for taking advantage of them are at your fingertips. Most important, now we feel the real fun is about to begin.
I’m Ready and I Have Been for a
Long Time. I Hope You Are Too!
Dad began to prepare me for this situation when I was very young.
He loved this country deeply, and I naturally inherited that sentiment. But he also explored broader horizons and taught me to do the same.
Many decades ago, for example, when Japan was still a third-rate economy, he decided that, one day, it was going to provide some of the best investment opportunities in the world.
He helped write a book about Japan’s economy. He even enrolled at the Japan Society in New York City to study Japanese, something unheard of in those days.
Then, turning his attention southward, he explored Costa Rica and learned Spanish. He explored Brazil and learned Portuguese. He left no stone unturned.
But he was too far ahead of his time.
In those early days, you could count on your fingers the number of people on Wall Street who had an interest in overseas investments. Japan was still viewed as the enemy. Brazil was still considered a mystery.
And even those who bought into the concept could not get into the practice.
Reason: Investing in any foreign country was next to impossible.
To buy foreign shares you’d have to travel abroad to open a brokerage account. Then you’d have to transfer money without violating a raft of obscure legal and tax barriers. Just getting information on foreign stocks was a big challenge.
There were no mutual funds or money managers specializing in foreign countries. Many foreign countries didn’t even have stock markets, let alone stock indexes.
Today, in contrast, investing in foreign markets couldn’t be easier.
There’s an exchange-traded fund (ETF) for nearly every major stock market in the world. ETFs are issued by some of the largest and most stable U.S. financial institutions. And anyone can buy them at almost any time — in tiny amounts, huge amounts, or anything in between.
In fact, right now, I count more than 104 ETFs covering foreign markets — with more being introduced every month.
You can effectively buy an entire country. You can buy a whole region. You can buy a sector within a foreign market. You can buy single sectors in several foreign countries at once. You can buy an ETF that focuses on foreign dividend-paying stocks. The possibilities are virtually unlimited.
And like domestic ETFs, these international ETFs are traded like stocks. You can check the value of every ETF you own in real time at any moment of the trading day. And you can get in or out almost instantly, without penalty.
Let’s take a look at three of our favorite examples …
Why Brazil’s Future Has Arrived
An interesting story: When I was 13, Dad and I visited a small, fledgling research company in the financial district of São Paulo, Brazil — a one-room office occupied by two analysts in jeans and T-shirts.
They said they were working on a new index, and we gave them a few suggestions. We thought it was a great idea. But none of us could have dreamed how successful it would be.
Later, that index became known as Bovespa, easily the most important in all of Latin America. And today, countless investors who own the Bovespa index or its components are making many billions of dollars in profits.
To get an on-the-scene update, I just spoke to my brother, Joseph Weiss, who lives in Brasilia.
Joe’s the only person I know who has worked for governments and corporations in every country in Latin America.
Like me, his favorite investment opportunities are in Brazil. And like me, he’s convinced that the stock market boom in Brazil is not a passing phase. His reasoning:
“Brazil has more untapped arable lands than any other country in the world. So it’s going to be a big winner in the world population boom.
“Brazil is the world’s biggest producer of ethanol. So it’s going to be a big winner in the alternate energy boom.
“Brazil is the world’s largest producer of small- and medium-sized aircraft, and the third largest maker of aircraft overall, trailing only the U.S. and France. If you’ve ever flown on a commuter flight, you’ve probably flown on a Brazilian plane.
“So I believe what you’ve seen so far is just the early phases of a much longer term trend.â€
I agree. We used to joke that Brazil was the land of the future, but that its future never came. Now it’s here.
Why Russia’s Bad
Times Are History
For a boots-on-the-ground view of the opportunities in Russia, I also just talked to Claus Vogt, the editor of the German edition of our Safe Money Report. Claus visits and tracks Russia from his firm’s headquarters in Berlin, and I just reached him there by phone.
His own words:
“It always amazes me how different the perception of Russia is in the U.S. compared to Germany or Europe. I have the impression that many U.S. journalists, politicians and Wall Street analysts are still fighting the old cold war.
“In Europe, we don’t see Russia as a major threat any more. We are willing to integrate Russia by doing business. As I see it, the politics of Russia do not interfere with the profits in Russia. It’s more the opposite. It’s the profits that are driving the politics in Russia as well.
“It’s also incorrect to say that Russia is almost entirely an oil play. Yes, about half of the Russian stock market capitalization is made up of oil and gas companies. But people who make that argument are missing the rest of a very dynamic story — a financial sector that’s growing very impressively and an industrial sector which is finally being rebuilt as well.
“This helps explain why Russia’s stock market was up by over 90% last year, and should continue to rise sharply in the years ahead.â€
China on a New Launch Pad
Next, I spoke to Larry, who’s in Asia right now, and he promptly rattled off three powerful factors that are driving the Chinese markets in the very near term:
“First, Beijing is spending $500 billion — a half trillion dollars — on just two events — the 2008 Olympics and the 2010 Shanghai World Expo.
“By the time that money works its way through the Chinese economy, and it gets loaned and loaned again via normal credit creation, that could create another $2 trillion in GDP just over the next 2-3 years — potentially doubling the size of the Chinese economy much faster than anyone currently realizes.
“Second, on March 1, Beijing will put into effect relaxed leasing laws allowing Chinese to start leasing cars, computers, office equipment and more, propelling the consumer economy even further.
“And third, in the next few months, China is probably going to allow insurance companies, which are some of the largest in the world, to start investing in the commercial property markets, sending property — and stock markets — still higher.
“In all markets, there are bound to be some bumps along the way. But every investor should start diversifying internationally.â€
Good News and Better News
But as you can see, these reports from Claus in Europe, Joe in Brazil and Larry in Asia are not just extremely timely. They’re also rich with profit potential.
Too bad all of our readers couldn’t be on the phone with me when I talked to them — because the few comments I’ve quoted for you here are just a small sampling of the opportunities we discussed.
Good news: I recorded every word!
Better news: You can listen in right now.
Just call 1-888-348-4629, and when prompted enter your passcode 995980, followed by the pound (#) sign.
Or if you’re overseas, just dial +1-719-884-8882.
It’s on a large phone system that can take all your calls at anytime, from anywhere in the world. And, as long as you’re calling from the U.S. or Canada, it’s free.
Warning: The company providing this facility will take it off line the day after tomorrow (Wednesday, February 21).
So if these opportunities appeal to you, be sure to call before it’s gone.
Good luck and God bless!
Martin
About MONEY AND MARKETS
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MONEY AND MARKETS (MaM) is published by Weiss Research, Inc. and written by Martin D. Weiss along with Sean Brodrick, Larry Edelson, Michael Larson, Nilus Mattive, and Tony Sagami. 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. Regular contributors and staff include John Burke, Amber Dakar, Kristen Adams, Jennifer Moran, Red Morgan, and Julie Trudeau.
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