We call it “the only trend that matters.”
It is the most important financial idea we could ever give to you. The fate of millions of Americans rests in a single market, where just one financial instrument trades, and…
This market is collapsing. Its downfall began, as we predicted at the time, in late 2008.
This single market determines our standard of living, our role in the world, and our prestige as a nation. It directly influences the price of food and oil. And that’s not all…
[ad#Google Adsense]Most of the world’s other markets depend on this market, too. The price of every fixed-income security in the world is based directly on this market. The prices of U.S. stocks depend on this market – not directly, but strongly in comparison.
Most important, the U.S. dollar depends on this market.
You see, foreign investors own trillions of this asset. As the market collapses, foreign investors will sell. As they sell, they will also unload dollars. This market is the key to the future value of bonds, stocks, and the U.S. dollar. That’s why the decline of this market is the only trend that matters.
We’re talking about the collapse of the largest bond market in the world – the market for U.S. Treasurys.
The best illustration of this trend is the chart below. We urge – no, we beg – our readers to pay attention to this chart. Put a copy of it on your refrigerator. Update it weekly. Keep your eye on it. And make sure you truly understand what it means.
The chart compares the value of long-dated U.S. Treasury bonds (TLT) to the price of gold (GLD). When we say “long-dated,” we mean U.S. government debts that don’t come due for more than 20 years. This chart shows the value of the bond market compared to gold since December 2008.
Whenever someone tells you he believes we are exaggerating the risks of our government’s debt load and its dependency on “quantitative easing” (aka printing money), show him this chart.
This chart demonstrates the collapse of the purchasing power of our currency as gold rises. And it shows the corresponding collapse in the credit of the U.S. government as bonds fall.
Just to be clear about this… We are not rear-looking experts. We have been warning about these issues frequently (almost continuously) since December 2008. Here’s what we wrote back then:
None of the government’s bailout plans will solve any of the problems. The government can only shift the burden of the failures. Instead of bondholders and shareholders being wiped out, taxpayers are put on the hook. These actions will temporarily resuscitate the economy – but cause a permanent decline in the value of the dollar… inflation will wipe out much of the value of long-dated U.S. government bonds, causing their prices to plummet.
In that issue, we told folks to “buy as much gold bullion as you can reasonably afford.” We’re repeating these warnings again because the market for U.S. Treasurys recently “broke down” through an important level. The big government bond fund (TLT) just struck its lowest low in nine months. The decline seems to be accelerating.
When we began writing about the looming collapse of the bond market and the risks to the U.S. dollar, a lot of people called us “right-wing nutjobs” or “gold bugs.” That’s not the case.
Our advisory was founded (in 1999) on the idea the Internet would change our lives in a profound way. We write about the biggest financial trends we can understand – whatever they happen to be. We have always strived to understand the facts and allow the facts to dictate our view. Now, three years after we first predicted the collapse of the Treasury market, more and more people have discovered these facts. They can look around and see with their own eyes what’s happening. Our ideas have gone from fringe to mainstream.
Despite the growing number of people waking up to these facts… and the considerable rise in gold over the past 10 years, it’s still not too late to buy gold and silver bullion. But I urge you to hurry. The secret is getting out… and precious metals are destined to skyrocket in the coming years.
Good investing,
— Porter Stansberry
P.S. We tried to run a television ad warning about the risks of our country. As far as we can tell, nothing in the ad is even mildly offensive. But no large TV network in America has agreed to run it, not even Fox. You may believe you have the right to free speech, but not in any venue that matters. You can click here for a detailed video on how I recommend you protect your family and your wealth from the dollar’s destruction.
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Source: Daily Wealth