Get This Right And You Get Everything Right

Get this one thing right and you get everything right…
The FED has made savings a four letter word…
Banks are more dangerous than standing armies…
The four signals to sell gold…


Growing and protecting money comes down to one simple idea, you have to get the big picture right. Picking stocks is fun but does not matter if “YOUR” big picture is incorrect. Get the big picture right and you get everything right.

If you investment accounts have not increased in size (outside of you depositing more money into them) over the past ten years then your big picture is wrong.

The FED has made “saving” ugly and disgusting. Investors are being forced to take their money and savings and speculate with it in the markets.

The Fed wants stocks to go up so you feel a little bit richer…so then you will spend just a little bit more…so then the GDP numbers will look a little bit better. And at what cost?

Last week I talked to a group of white collar unemployed people in Walnut Creek, California. And afterwards a gentlemen came up to me and asked what he should do?

This gentleman was 65 years old and needed his investments to generate an income for him. There are tens of millions of people like him, and the truth is, he has very few choices…and none of them good…almost entirely because the FED dropped rates to zero. 

Remember the FED is a private company built to support the largest banks in the United States…and not you.

This is why the FED dropped rates to zero. A zero interest rate policy is designed to help banks reflate their balance sheets so they are well capitalized. The majority of Americans are living into a smaller and scarier future so banks can get reflated. Good job Bernanke.

Thomas Jefferson got it right almost 250 years ago

I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks (the Fed is a private bank) to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.”
Thomas Jefferson (1743 -1826)

The four signals to start selling gold.

  1. Gold will become common place. The theme of the day will be, “well, of course you own gold, every smart person has gold as a part of their portfolio”. We are nowhere near that mindset today.
  2. Gold products will be marketed to main street investors by big box financial advisors like Merrill Lynch, Morgan Stanley and by life insurance companies, and 401(k) companies. We are not there yet either.  
  3. Owning gold will be considered a respectable investment. Owning gold today is still a fringe investment.
  4. The stock market will look really cheap. Today it will cost you $19 for a dollar of profit. That means, in today’s prices, it will take you 19 years just to get your money back. Ouch. That is not cheap.

Gold is just above $1350 today.
The S&P 500 is just above 1200 today
The 30 year treasury is just above 4.3% today

Where will they all go from here?

To stay updated with the markets and find out how high (or low) they might go…and to know when to collect your profits, check out The Insiders Club, my monthly advisory on all things money and investing.

Together, we are protecting and growing your money,
RC Peck, CFP