Blog : Military, Markets, Election, Interest Rates, Gold, Oil...

by Peter Leeds on September 14th, 2016

Things are really starting to heat up in the financial world!

Here is my personal take on many of the major events going on right now. From interest rates to quantitative easing, from oil to precious metals, from recession to a stock market crash, I provide details about everything here.

I will even talk about how the Presidential election, as well as military posturing in the South China Sea, will affect you directly.

There are plenty of opportunities setting up right now, some of which will help you profit.  With others, you will need to consider which actions to take in order to protect yourself.

The Federal Reserve Interest Rate Policy:

Before the Federal Reserve takes the foolhardy step towards negative interest rates, they will first raise interest rates.  They will do this before the end of the year - the move will be very small (a quarter or half of a percentage).

The sad part is that it is going to cost you more money; on your line of credit; your mortgage; your car loan; student loans; your credit cards. It will also act as a tax against every corporation (besides the banks) here in America.

After raising the rates, the Federal Reserve will be forced to backtrack, and lower them in 2017. Once they do that, it will clear the way for them to start charging you negative interest on your savings.

Negative Interest Rates: 

The specter of negative interest rates has reared its ugly head again here in America. This is a failed policy of theft from civilians by the central bankers and financial institutions overseas.  

Despite the obvious evidence that negative interest rates backfire, and constrict the economy, the witless and foolish bankers steering our fiscal policy keep mentioning them.  They have no idea of what to do, or how to stimulate the economy... although that doesn't stop them from talking about it, or trying dumb things.

So, they are taking the simple route.  They will just take your money against your will.

You can see a video about negative interest rates, and the theft that comes along with them, here in this video.
 

Quantitative Easing Part Four:

They will not call it "quantitative easing," but they will give it a different label in order to act like they are doing something new.  In reality they are just printing more money, and watering down the purchasing power of the American dollar.

The Federal Reserve will purchase billions of dollars of government bonds, without which the entire financial system could potentially be under strain. It is actually this quantitative easing which has elevated the stock market over the last few years, pushing the major indexes higher as they ballooned the monetary supply.

The US Dollar:

Not just in America, but also in most major countries across the globe, nations are printing massive amounts of new currency. As each player does this, they decrease the value of their money, which results in an increase in their exports and a boost to their economy.

This is a race to the bottom. Whichever nation creates the most brand new money benefits from the greatest decrease in the value of their dollar. If the value of the American dollar is cut in half by doubling the monetary supply, theoretically all American products and exports would cost half as much to other nations, thus boosting our sales of products and services.

There will be so many unintended consequences which will result from this. For example, inflation will fly, retirees will have less comparative value to live off, and the value of these watered-down dollars will just continue to slide lower.

This will make it much more expensive for developing nations to pay off their US-based debts.  It will also cause the "worth" of the Greenback to slide further... as it has 95% in value since 1900.

Oil:

Every time oil prices increase, more wells come back online, and there are increases in the amount of the commodity being dumped on the market. Right now there is far too much oil available, much of which is floating in massive tankers in the ocean until a buyer can be found.

Many countries, such as Venezuela, are dying beneath these low oil prices. They have no choice except to continue to push their supply (and only major export) out to the market, if they want their people to eat, have medicine, and purchase basic supplies.

In the short and medium-term, oil prices will be under pressure. If there is a recession or economic collapse as we anticipate, that slide will be even more significant.

This will result in many of the swing producers plugging their wells, or pausing their rigs. There will then eventually be a return to demand for oil, at which point many of the suppliers will have gone too far in terms of closing operations.  At that point, there will not be enough supply to meet any rising demand.

This will result in oil prices, once they fall into the $30's for an extended time, spiking significantly higher. Depending on the speed at which the demand will grow, it may be extremely difficult for the supplies to keep up, which will result in the per barrel price of oil driving well above $100.

Military and Political Risks:

Potential conflict in the South China Sea is expanding dramatically.  North Korea is testing nuclear missiles, America and South Korea had a bomber flyover in response, and every political candidate is talking tough about how they're going to deal with the secretive nation.  The potential for increased risks and conflicts is growing.

Neither side will back down, and there may not be a palatable solution to any of this. Add to that the fact that China is building man-made islands in the South China Sea (and quickly and significantly militarizing them).  We are quickly running out of good options.

The fact of the matter is that there is nothing that America can do against China, North Korea, or even Russia, without entering an actual military conflict. The days of military dominance by America are over - Mutually Assured Destruction has a lot more players now than just Russia and ourselves.

While we hope for a palatable solution, issues around the world right now (which includes Syria, Africa, Ukraine, North Korea, and especially the South China Sea) may not allow for one.  We also understand that it's important to prepare for the worst - when you prepare for the worst, you very often do not have to face it.

One of the best ways to prepare for military conflicts is to insulate your portfolio by owning a certain percentage of precious metals, such as gold.

Gold:

Besides military conflicts, gold is one of the only assets which will preserve your wealth, and in fact increase it.  All the quantitative easing and money printing that's been going on all around the world is making gold more costly (driving prices up).

The American dollar has been doing well lately, which masks the fact of how strong precious metals have been performing against most currencies.  Gold has been one of the best performers this year in terms of the American dollar, and would've even eclipsed that distinction if the buck hadn't been increasing so strongly. 

Most of this increase is based on the fact that the American dollar is the best of a lot of bad options.  Just about every currency across the globe is printing more supply and watering down their purchasing power.

Silver and Platinum:

Both silver and platinum will outperform gold on a percentage basis. The silver to gold ratio, and the platinum to gold ratio, are completely ridiculous right now.

Historically, platinum is valued at twice the level of gold, but right now platinum and gold prices are about equal, even with platinum being priced at less than gold on many occasions.

We've also gotten to a tipping point with silver, where more than 100% of the annual supply is used up for industrial uses.  At no point in history have we been in such a situation... until now.

Election:

The media's job is to make you think that the election is going to be a close one. They're doing an excellent job of that.

While anything can happen, such as Hillary Clinton getting caught in bed with Monica Lewinsky, as it stands right now the Democrats are set up to win the election by a landslide. Trump supporters typically don't like to hear this, and actually get very upset with me for saying such a thing, but we are not talking about what we hope will happen - we are preparing for what we think will happen.

There are certain types of stocks which will outperform if there is democratic leadership in the White House in November. You can see lots of these through this link.

Markets:

The most widely followed institutional investors and billionaires are finally coming out and admitting that the economy is absolutely on the edge of a potential downfall. We've been explaining this to you now for almost a year, and I'm glad that the "whales" are finally seeing it too!

I've been using stats such as the velocity of money, and the "Q ratio," to explain what is about to happen to your investments.

There will be a recession, and pretty soon. There will be a stock market correction, also vary soon. We believe that within less than 18 months (and more likely probably 6 months) things will get very ugly for investors.

As we will also explain, there are tremendous and massive ways for you to take advantage of the potential chaos. There is plenty of money to be made, just like there were more millionaires made during the Great Depression than any other time in human history.

All of our stock picks are designed to take advantage of the potential troubles which the economy is going to be facing. Our selections will do well in spite of any economic chaos, and in many cases because of that chaos.

You can also see which types of stocks will do well during the recession in this video.

New Videos:

Speaking of videos, we've got plenty of new ones for you which explain how to trade penny stocks well.

• Support levels in penny stocks
• Resistance levels in penny stocks
• My awful start in trading

New Book by Peter Leeds?

I started putting together my new book. It is called Stockology, and I can't tell you too much about it yet because I have to speak with my publisher first (they have the legal rights to it).

As this book starts to take form, we will keep you informed and updated!