We're Nearing the Biggest Change in the U.S. Economy Since 1971

Steve's note: Yesterday, we shared an essay from my colleague, Porter Stansberry, dealing with major upheaval in the U.S. government. Longtime readers know I am bullish on U.S. stocks. But since Porter's perspective is so valuable, I'm sharing a second essay from him today. He believes big changes are coming that could transform how companies make money in America… resulting in huge profits for smart investors.
 
I think I might have gone too far…
 
Recently, I've been writing about a "secret war" in Washington, D.C. And I've been describing a very high-level source, without naming him. I'm even broadcasting a meeting with this mysterious "Metropolitan Man."
 
And you don't even know who he is yet.
 
I can understand how this probably sounds: Self-serving. Promotional. Even crazy. After all, most people haven't been reading our work for years or decades. Most subscribers don't remember when I predicted (accurately) that Fannie and Freddie would go to zero.
 
They didn't read my work back in 2007, long before the crisis, when I explained exactly why General Motors would go bankrupt. They never saw my famous satiric letters "from the Chairman of General Motors" where I wrote the truth about what was really happening in the heavily indebted, old carmaker.
 
All of that sounded "crazy," too. But it saved some of our subscribers from a financial disaster that would have erased their life savings…
 
I'd like the opportunity to backtrack…
 
I'm not going to mention anything about secret sources or expensive meetings. I'm not going to make any kind of "get rich quick" promise that you'll think is exaggerated.
 
I'm just going to tell you about the facts we have right now. And I'm going show you why they're so important – especially for investors.
 
You see… I know that our ability to tell interesting stories garners a lot of attention. But I also know that kind of writing alone won't keep anyone happy for long.
 
For our business to succeed, our readers have to trust us, and they have to profit from our work.
 
That's why, in addition to the "carnival barking," I make sure you're getting the information I'd want if our roles were reversed.
 
And right now, we're on the cusp of the biggest change in the American economy since 1971 (when the gold-exchange standard collapsed).
 
Whether you attend our meeting about this coming massive change, or listen to it, or do neither, I want you to know why this is so important… and how it's going to change virtually everything about how our economy works – who wins, who loses, and how we're all taxed.
 
This isn't about politics. It's about economics.
 
Let's start 23 years ago, when a young congressional aide completely disrupted testimony before the Gold Commission…
 
The commission routinely studies the feasibility and the attractiveness of returning the dollar to some kind of gold standard. It has never gone anywhere because no politician whose country's currency is universally accepted (like ours) would ever willingly give up his printing press. So these meetings normally aren't worth attending or listening to. But this one was different…
 
At this meeting, a 24-year-old congressional aide began asking a series of scintillating economic questions. Questions that went directly to the heart of some of the most compelling academic work that had ever been done on the U.S. tax code and its impact on our economy and trade patterns.
 
People who were there still remember the series of questions that were asked by this particular young congressional staff member. "He was clearly far better informed and much more intelligent than any of the actual congressmen in the room… "
 
Today, that young 24-year-old is now 47 years old. And he's no longer a congressional aide. He's the speaker of the House of Representatives, the primary lawmaking body of the United States. He's also the leader of the majority party, giving him potentially awesome powers to make new laws or reform old ones.
 
His name is Paul Ryan.
 
Ryan's main economic goal is to reverse the current U.S. tax policies that make it harder for our firms to compete in overseas markets. He also wants to end the perverse incentives of our tax code that continue to warp our economy in ways that make it more vulnerable to financial manipulation.
 
(Ironically, Larry Summers at M.I.T. did some of the best academic work on these topics in the 1970s. But now that these ideas don't jibe with his current politics, good luck getting him to answer a question about that honestly.)
 
Let's look at three important ways the current U.S. trade and tax regime hurts our economy.
 
First, the current tax regime favors debt over equity
 
Companies are allowed to expense the total amount they spend on interest. This is a huge incentive for them to use Wall Street's big investment banks to borrow as much money as possible. It reduces their cost of capital. This explains why, since 2000, nearly all of the net debt issued by Wall Street has gone toward mergers and acquisitions or share buybacks.
 
Managers have a huge tax incentive to leverage their balance sheets as much as they can. But those actions are bound to cause problems when interest rates reverse.
 
Most investors still don't realize how big or dangerous the corporate-debt bubble has become…
 
As of the second quarter of 2016, investment-grade corporations were spending $119 billion annually on interest expenses – the most since 2000, just before the big tech-debt bust of 2001. The difference today is that interest rates are much, much lower. And that means the debt balances are vastly higher. In total, U.S. corporate debt has soared from less than $3 trillion to almost $7 trillion in just the last decade. Worse, a higher percentage of this debt is rated "junk" than ever before.
 
Thus, American companies are now more exposed to either rising default rates or rising interest rates than they've ever been before.
 
This trend has been great for Wall Street. But it's not great for America.
 
Ryan knows these debts (and the incentives that created them) threaten our economy far more than any other factor today. By eliminating this tax preference for debt funding, we can stop rewarding public company executives for taking huge balance-sheet risks with America's biggest companies. You don't have to be in favor of taxes (and I'm not) to see that the tax code should NOT reward managers for doing the wrong things with their balance sheets.
 
Another huge distortion in the current tax regime is how different kinds of capital investments are expensed
 
Some items – like computers and software – can be fully expensed in the year they're purchased. They're treated like a routine cost of doing business. But longer-term corporate investments can only be expensed over many years. Inflation robs companies of the real value of these tax credits, providing a perverse incentive to not make big, long-term investments.
 
Allowing companies to reflect their actual expenses (including all investments) in the year they are incurred would provide corporate America with an important tax break. Politically, that's not going to play well in the pages of the New York Times. But the reason for doing so is vitally important if we want our economy to grow over the long term… There is no other proven way of increasing productivity (and thus, wealth). We must make far more and far larger long-term investments in American productive capacity. And we shouldn't have a tax policy that makes this harder to achieve, instead of easier.
 
Finally, the current trade and tax regime makes it logical for every company to store as much of its value as possible overseas
 
… and only import what they plan to sell in America – nothing else.
 
Why does every important American software maker (including Apple and Microsoft) have its international headquarters in Ireland?
 
By keeping their core intellectual property in Ireland, these companies can pay far, far less in taxes. Meanwhile, they can import that intellectual property back into the U.S. (after manufacturing in China) for free. This allows them to pay a tiny fraction of the taxes they would otherwise have to pay. And it also keeps a lot of their employment and capital outside of the U.S. (Microsoft, for example, just spent around $250 million building a new campus in Ireland.)
 
Similar strategies are being employed at some level by almost every U.S. multinational company.
 
This is completely insane.
 
Lower wages don't drive U.S. companies to manufacture overseas. The difference in wage rates is almost irrelevant compared with the costs of setting up infrastructure, supply chains, and transportation costs. The only reason most U.S. companies are setting up manufacturing and research and development overseas is to avoid U.S. taxes and regulation.
 
Changing just these three components of the U.S. tax code could be done on a revenue-neutral, zero-cost basis
 
And these three changes alone would drive U.S. gross domestic product growth from around 1% to well over 3.5% – something we haven't seen for more than eight years.
 
These changes could help alleviate all of the government's other entitlement funding problems, as increases to wages and salaries would power funding for those programs. These changes would also see a big increase to investment income – in the form of dividends – to benefit retired investors.
 
These are the primary planks of the House Republican tax-reform plan, which Ryan wrote and has the support of nearly every Republican congressman.
 
Considering the Republican majority in the Senate and the Republican-led White House, there's no reason this tax reform can't get passed. It may even be passed on a bipartisan basis, because these reforms would be great for the hard-hit manufacturing states like Michigan, Ohio, and Pennsylvania.
 
There's only one problem…
 
Most of the people working in and around the government hate these ideas. That's because many of the "swamp people" – the career bureaucrats and lobbyists who live in D.C. – derive a lot of power from the current law.
 
Think about how many law firms and lobbyists exist to help American corporations hide taxable income overseas. Think about how many Goldman Sachs investment bankers have pitched a bond offering by explaining how the tax treatment will lower a company's cost of capital. And think about how many thousands of lawyers, accountants, and lawmakers all around the world have benefited as most Fortune 500 companies moved offshore with their manufacturing.
 
These reforms are the "gun to the head" of the so-called "Deep State" that controls D.C. and normally controls the agenda in D.C., too.
 
Make no mistake, the swamp people, or the Deep State, or whatever you want to call them, are going to do whatever it takes – including breaking the law – to try and sabotage this reform.
 
Fairfax County is in Northern Virginia. It's a D.C. suburb where a huge number of the swamp people live. It's a place where incomes and home prices never go down. The area has boomed as the government has grown and grown since the 1960s. Fairfax County voted for Hillary over Trump by the widest margin of any presidential election in the modern era – 63% in favor of Hillary.
 
Fairfax isn't alone. Some of the wealthiest counties in the country surround D.C. It's no surprise: the swamp people have done well. Their communities haven't seen a recession, and the government hasn't downsized. Normally, wealthy suburban areas tend to vote Republican. But not around D.C. They all voted for Hillary.
 
Even within Trump's own administration, we're hearing voices speak out against this kind of major tax reform – especially the two guys from Goldman.
 
Don't forget, Gary Cohn is a registered Democrat and was the second in command at Goldman for a decade. Steve Mnuchin is not only a second-generation Goldmanite, he has also been on George Soros' payroll. (For you conspiracy theorists, Mnuchin was also initiated into Skull and Bones at Yale.) These guys are the Deep State… And Trump put them in the two most senior economic roles in his cabinet.
 
And of course, various companies are taking sides, too, based on whether these changes would be good for them… which brings us to my next point…
 
A lot of companies' entire business models are based upon the current tax and trade regime.
 
Take railroad Kansas City Southern (KSU), for instance. A lot of its traffic is made up of automobiles manufactured in Mexico and shipped back into the U.S. From a high of around $125 a share, the stock has already fallen back toward $85. But there's no doubt in my mind that the stock would go much, much lower if this kind of major tax reform passed.
 
In fact, my research team has compiled a list of about 20 stocks that have the most to lose or the most to gain from these kinds of reforms. You can see the stocks we've been studying below.
 
The blue line shows the average performance of the tax-reform "winners." The green line shows the returns of the tax-reform "losers."
 
What we see is that the tax-reform winners have taken off a bit since Trump's election. They're up about 18% on average. But with the uncertainty that still surrounds this bill (especially after the health-reform bill failed to pass), the losers haven't moved much… yet.
 
What this tells me is that plenty of uncertainty continues to surround what will be in the tax-reform bill and how it will affect our economy.
 
And that's a huge opportunity for us.
 
The latest information we have out of sources in D.C. is that there is a 70% chance that a major tax reform will pass this year…
 
It will probably happen in the fourth quarter, for tactical reasons I'll describe in detail at our meeting tonight. That likelihood is down from 99% just a few weeks ago. However, within the next several days, we'll receive a brand-new indicator that could – depending on how it goes – raise the likelihood back to 99% (or even higher).
 
As you can see, there are still a lot of moving parts here. And hopefully you are starting to understand why this is so important to our country and dozens (or hundreds) of major corporations.
 
Now… I did what I promised to do. I told you what I would want to know if our roles were reversed.
 
But here's what the straight talk can't communicate…
 
This is far more important than politics or what tax rate U.S. corporations pay. This is an underlying battle… a virtual war.
 
On the one hand are people like Paul Ryan, who know how most of the country is struggling and how hundreds or thousands of corporations could go bankrupt if super-low economic growth rates persist.
 
I've warned about the problems looming in the market for corporate credit for the last 18 months. Trump's tax reform, if it spurs the economy as much as most economists think, could be the answer to this huge problem. It would allow companies to grow out of their debt burden and give them an incentive to pay off their debts, instead of adding to them.
 
In short, Trump tax reform means that the "Trump Trade" – the big rally in stocks since the election – will continue.
 
On the other hand are the swamp people and the Goldmanites. They are incredibly powerful. And lately, they've become reckless and desperate. They're driving the Russian-tampering storylines. They fear Trump's presidency and his majority in both houses. They know he could wipe out everything they've spent the last 40 years building. They don't care about what happens to the rest of the country. They only care about Fairfax County.
 
This is the most important political debate and potential economic reform in the U.S. since I was born in 1972…
 
This debate – about tax and trade reform – will determine the economic fate of our country for the next few decades.
 
We're either heading into a new era of growth (and potentially a lot of inflation), or we're sliding back into a depression caused by a mountain of bad corporate debt.
 
We think we know what's going to happen. And we want to tell you everything we know. That's why we've convinced the best-placed source we could have in D.C. to come forward.
 
Sure, we call him the "Metropolitan Man" but the truth is, he's the ultimate swamp person. He has lived in the highest circles of power in D.C. for almost 40 years. No one anywhere knows more about what's really happening and why.
 
In fact, it was the Metropolitan Man who first met Paul Ryan more than two decades ago at the Gold Commission hearing. And the Metropolitan Man has helped Ryan develop these ideas.
 
If you want to position your portfolio (or your business) to prosper in the midst of these radical changes happening in D.C., I urge you to attend our live webinar and listen carefully to our meeting (for $19.95).
 
As I always say, there is no such thing as teaching, there is only learning…
 
Either you're willing to spend $19.95 to hear directly from one of the most powerful and longest-serving senior leaders in D.C… or you aren't.
 
If you do, you'll learn more about which investments you should be making now to profit as the biggest economic reforms in our lifetime occur.
 
Or… you can keep reading the paper and see whatever the Democrats want you to believe.
 
Make the right choice.
 
Regards,
 
Porter Stansberry
 
Editor's note: Tonight, Porter will reveal how Trump's tax reforms could move specific groups of stocks in surprising and dramatic directions this year, causing big winners AND big losers. Tune in to the live webinar tonight at 8 p.m. Eastern time by clicking here.

Source: DailyWealth

The 'Deep State' Is Fighting Back

Steve's note: We're nearing the final innings of an incredible bull market – and as I've written before, I expect the biggest gains are still ahead. But my friend and colleague Porter Stansberry sees a different opportunity today. He believes an event is coming that will transform the U.S. economy, potentially for decades to come. I may not agree with him 100%. But I do believe this essay presents some important ideas, and that's why I'm sharing it today…
 
A secret civil war is being waged right now in Washington D.C…
 
It is about to have a HUGE impact on our country.
 
We're approaching what will be the most dangerous period in our country's political history since the Great Depression. What could happen next scares me. But I continue to be optimistic that what will unfold will be great for our country.
 
I'm certain that you simply won't believe much of what I'll tell you today. In fact, until I did my own follow-up research to verify what I could from my sources, I disregarded this story as "political nonsense" or just another D.C. conspiracy theory.
 
Besides… it was all too horrible to believe. But then… almost everything my sources told me would happen started happening.
 
Let's begin…
 
Did you know the U.S. government has a secrecy designation so restricted that virtually nobody – not even lifetime members of the intelligence community – even knows what it's called?
 
It's not "TOP SECRET." It's way beyond that level.
 
In late 2009, President Obama created this new level of secrecy inside our government with an executive order (No. 13526) – so Congress never approved it. Administered by the CIA, this new level of secrecy has created a covert government-within-the-government that almost nobody knows… and absolutely nobody is monitoring.
 
If you've ever heard the term the "Deep State" – the secret government-within-the-government that actually holds power – then you know why a level of secrecy beyond "top secret" is so important. This new, more restricted level of secrecy was created so that the most powerful leaders of our government could communicate in total isolation.
 
This level of secrecy is such a closely guarded secret that the name of the program itself is classified – and divulging the name is a crime, punishable by at least 10 years in a secret prison. So this level of security clearance is known only as "codeword."
 
At the highest levels of our D.C. government, only two dozen or so people have codeword clearances…
 
I learned about this earlier this month. I was invited to lunch with someone who has held that level of security clearance. He told me about the existence of the codeword-level program. This isn't a rumor. It's a fact.
 
For the last 30-plus years, my source has worked for and around the highest levels of our government. He is currently regarded as the president's most likely choice to become our next Federal Reserve chairman.
 
Today, however, his clients include the world's top hedge-fund managers and the leaders of America's biggest corporations. He is, in short, America's corporate representative of the Deep State.
 
We call him the "Metropolitan Man."
 
We met about a year ago. He reached out to me through a mutual friend – one of the best, young hedge-fund managers in New York. He asked me to join him for dinner at the Metropolitan Club in New York, one of the most elite clubs in the United States.
 
(Legendary banker J.P. Morgan founded the club. It's where billionaire investor Warren Buffett held his 50th birthday party. And it sits at the southeast corner of Central Park, across from The Plaza Hotel, with a great view of Columbus Circle.)
 
At the time, the Metropolitan Man was forecasting – correctly – that the world's central bankers and their negative-interest-rate policy were failing… and that they would soon trigger a global run out of paper money and into gold. Over the next several months, gold and gold stocks soared (as you may remember).
 
A few days ago, the Metropolitan Man asked to see me again…
 
He wanted to talk about something he had never seen before in all his years working in the government.
 
For the first time ever, a codeword-level secret was leaked to the press. Nothing this sensitive has ever been leaked before – ever.
 
Among senior leaders in D.C., it is widely believed that the director of the CIA himself was responsible for the codeword leak. And it's rumored that this information was then passed to the press through New York Senator Chuck Schumer's office.
 
What was leaked?
 
It was the codeword-level secret CIA briefing about a meeting in Trump Tower last December… between a Russian ambassador and two senior Trump administration officials – Jared Kushner and Michael Flynn.
 
When Flynn lied about the meeting to the White House staff, he was fired. But the deeper question is: How did the CIA know about the meeting? How did it know how long the meeting lasted? How did it know exactly what was discussed? And how did that information end up in the hands of a New York Times reporter?
 
This backstory explains how Trump knows the CIA was spying on Trump Tower. And the counternarratives – Trump's claim that Obama was spying on him and the Democrats' claim that Trump is in league with Russia – are the beginning of a serious war. A civil war inside the Deep State itself.
 
Reading the newspapers won't explain how this war is being fought…
 
They will never publish a clear explanation of the battle lines – or even who is fighting or why. But the outcome of these battles is likely to determine the fate of our economy for the next several decades.
 
Let me explain why… and tell you what this fight is really about…
 
For the last 40 or so years, the U.S. economy has been built around a model that created vast power in D.C.
 
This model has a few important components…
 
First, we have a highly "progressive" income tax. Without extremely progressive income-tax rates – where about half the country pays nothing and the top 10% pay for roughly 80% – the electorate would never continue to vote for more and more government. But it does, mostly because it doesn't have to pay for it.
 
Second, the government has a powerful regulatory regime in place. This allows D.C. to essentially control vast segments of our economy. Take Wall Street, for example. Who gets to sell a bond or a stock to the public? Nobody the Securities and Exchange Commission doesn't like (i.e. yours truly). This power results in tremendous amounts of "tribute" – legal fees, fines, and hidden lobbying that flows into D.C. and feeds its economic ecosystem.
 
And finally… there's the North American Free Trade Agreement (NAFTA) and "free" trade. Our country has the ability to export all of the inflation generated by our central bank. This has led to decades of lower and lower interest rates and the government's ability to borrow essentially endless amounts of money without any serious inflationary consequences.
 
These three components form the foundations of Washington's power. Attack any of them, and you risk a huge fight with the Deep State.
 
What Trump is doing right now via his border-adjustment tax, additional tax reform, and regulatory rollback is targeting all three of them at the same time. If he wins, all of the power that has been consolidated in D.C. over the past 40 years will evaporate.
 
Trump has put a metaphorical gun to the head of the Deep State…
 
And now, the Deep State is fighting back, tooth and nail, to protect the system it has built.
 
Look at what has happened to the middle class in America over the last 40 years…
 
Did NAFTA prevent price inflation by allowing America's consumer economy the luxury of accessing the world's cheapest labor? Yes, it did. But the flip side was devastating to the entire manufacturing industry in the U.S.
 
And where did the resulting wealth flow? To D.C., and to the top 1% of America's wealthiest people who were able to access foreign markets (and shield the resulting income from America's tax system).
 
Meanwhile, America remains the only industrial country in the world with global income taxation (you have to pay federal income tax, no matter where you live) and without a value-added tax. In short, we've chosen a system that punishes wage earners, while rewarding individuals and corporations who use overseas labor. The result has been a decline in real, after-tax wages over the last 40 years. That's a recipe to destroy the middle class – and that's what has happened.
 
Trump's plan to effectively lower income taxes to 25% (maximum) and implement a value-added tax to discourage foreign production of U.S. goods will turn this entire economic structure on its ear and disenfranchise the Deep State that controls it. The winners will be the middle class, small-business owners, wage earners, and America's manufacturing base. The losers? Those who have invested heavily in the current Deep State regime.
 
Why is this scary?
 
Well, unlike the health-reform issue, the Metropolitan Man assured me that Trump's tax-reform agenda would certainly pass. "It's a done deal," he said. He told me that his job lately "has been to help major corporations understand what will be in the new laws and how they will impact various markets." That means the Deep State has been pushed into a corner. What it might do next, no one knows.
 
"That it would leak a codeword secret… Well, I would have told you that couldn't happen. I've never seen it before, not in more than 30 years in D.C. It's scary because if it'll do that, it'll do anything. Stage a terrorist attack? Start a war with China? Nothing is impossible anymore."
 
That's the downside.
 
The next several months could see our government erupt into open civil war. The FBI accusing the president of treason… The president accusing a director of the CIA of breaking the law and having him arrested. Who knows where this will lead?
 
On the other hand, assuming the government doesn't collapse into a civil war, Trump's new economic model will become a reality before the end of the year. A new economic regime is coming in America. For some industries (and for most Americans) these changes will bring massive prosperity. And for others – especially for companies and individuals who have been living at the government trough, tough times are looming.
 
Here's the best part…
 
I believe these coming changes are so important and could lead to so much wealth creation that I've convinced the Metropolitan Man to come forward.
 
We will hold a meeting with him, at our offices in Baltimore, tomorrow night.
 
The meeting with start at 8 p.m. Eastern time. It will last approximately two hours.
 
At this meeting, the Metropolitan Man will "take off his mask" and tell you about his role in the Deep State. He'll explain the importance of the codeword-secret leak.
 
And he'll discuss what the new Trump economic model will mean for various industries and parts of our country. He'll also explain how he knows the tax-reform/border-adjustment laws are certain to pass Congress and what those policies will mean for our country.
 
If you'd like to attend the meeting via our live webinar, you can listen online for only $19.95.
 
Yes, that's right. $19.95.
 
This is easily the most important and valuable meeting I've ever arranged. It has taken more than a decade of work to gain access to information like this… And I want everyone to benefit from the incredible access we've gained.
 
Please do whatever you must to be at this meeting. There isn't a more important event you could attend this year.
 
Regards,
 
Porter Stansberry
 
Editor's note: Don't miss Porter's Emergency Briefing tomorrow night at 8 p.m. Eastern. In it, the Metropolitan Man will share his intelligence on a specific and imminent event that's set to dramatically shake up the American economy. And we'll discuss which actions you can take right now to protect your investments and even make a fortune. To reserve your spot, click here.

Source: DailyWealth

We're in the Sixth Inning of the Housing Boom

 
"It's Time to Buy a House," I said in a DailyWealth headline in July 2009.
 
Back then was an incredible moment… There were no buyers!
 
But eight years have passed. Times have changed… Where are we right now?
 
To find out, let's look back briefly – and then look ahead…
 
Between 2009 and 2011, you could make offers on a house that were 25% – or even 50% – below the asking price… and occasionally land an "A" grade property at a "D" grade price.
 
I know this because I did it… Back then, I managed to buy a property for more than 90% off its peak price. The seller needed to sell, and I was the only offer.
 
Today, times have changed – dramatically.
 
One way to see this is by tracking the "sentiment" of homebuilders…
 
Homebuilders were incredibly optimistic about their prospects in 2005 – right before the housing market peaked and crashed.
 
As the market crashed, pessimism set in… Homebuilder pessimism set a record in early 2009. Take a look…
 
Ah, but look where we are now in builder sentiment. We are at the same levels we saw before the last major housing crash… right?
 
Let's take a closer look at this…
 
Last time, house prices didn't fall into a legitimate downtrend until 2007 – a couple of years after builder sentiment peaked.
 
On the flip side, house prices didn't genuinely start a new uptrend until 2012 – again, a few years after builder sentiment bottomed.
 
Take a look…
 
This same situation likely applies to housing prices today…
 
Clearly, we are no longer at the bottom in the housing market. Homebuilder sentiment is at a 12-year high – at levels not seen since the last housing boom.
 
But we have to consider the whole picture.
 
I've talked about this many times… I believe we have plenty of upside in house prices – primarily because there's no supply of homes to buy.
 
THIS is what the builders are excited about! With no supply of new homes, they KNOW they can keep raising prices.
 
We are clearly not at the bottom in housing. But to my mind, with no supply of houses, we are clearly not at the top in housing either. And (if you recall what happened during the last housing bull market) the biggest gains are made in the final innings of the boom.
 
The first inning – 2009 through 2011 – is in the rearview mirror. Now we're in the sixth inning. We should have a few more years of good times – and they could be really good times.
 
Stay on board in housing… It's still not too late to get in and take advantage of the significant upside we're seeing now.
 
You can still win the game. But don't hesitate… The clock is ticking. Your window of opportunity is closing fast. Get on it!
 
Good investing,
 
Steve
 

Source: DailyWealth

Panic Is Spreading in This Beaten-Down Sector

The Weekend Edition is pulled from the daily Stansberry Digest. The Digest comes free with a subscription to any of our premium products.
 
 Online-retail behemoth Amazon (AMZN) is taking its fight against brick-and-mortar retailers to a new level…

 
According to reports, Amazon has invited some of the world's biggest food and packaged-goods brands to a private meeting at its Seattle headquarters.
 
On the agenda? Convincing these companies to sell products directly to consumers – using Amazon's online marketplace, of course – and bypassing large retailers like Wal-Mart (WMT), Target (TGT), and Costco Wholesale (COST) altogether. As Bloomberg reported this week…
 
Executives from General Mills, Mondelez and other packaged goods makers will attend the three-day gathering in May… Amazon is looking to upend relationships between brands and brick-and-mortar stores that for decades have determined how popular products are designed, packaged, and shipped.
 
If Amazon succeeds, big brands will think less about creating products that stand out in a Wal-Mart aisle. Instead, they'll focus on designing products that can be shipped quickly to customers' doorsteps. Brands have been experimenting with such changes, so the Seattle event may well resonate.
 
"Times are changing," Amazon says in an invitation obtained by Bloomberg. "Amazon strongly believes that supply chains designed to serve the direct-to-consumer business have the power to bring improved customer experiences and global efficiency. To achieve this requires a major shift in thinking."

The reason is clear: Food and packaged goods are an $800 billion market, according to Bloomberg data. And it is one of the few remaining markets Amazon hasn't been able to steal away from brick-and-mortar stores.
 
But if Amazon can get these major brands to agree, that may not be the case much longer.
 
 Speaking of Amazon, the company's meteoric rise hasn't just changed the way we shop…
 
It has also made founder Jeff Bezos among the wealthiest men on the planet.
 
The 2.1% rise in Amazon shares on Wednesday added another $1.5 billion to Bezos' holdings… officially making him the second-richest person in the world.
 
Bezos now has a net worth of more than $75 billion… $700 million more than legendary investor Warren Buffett. Only Microsoft founder Bill Gates is worth more.
 
 Switching gears, U.S. bank lending to commercial and industrial companies has ground to a halt…
 
That's according to the latest data from the Federal Reserve. In fact, lending is now contracting for the first time in six years. As you can see in the following graphic, it has plunged at a 5.4% annualized rate over the past three months…
 
A chart of the much broader market of commercial bank loans and leases is showing similar – though less severe – stress, too…
 
Now, these charts don't give us reason to panic… It's still too soon to know if this is the start of a more significant "tightening" of the credit markets.
 
But as regular readers know, credit problems tend to precede problems for stocks and the real economy. If this trend continues, it could be an early warning of trouble ahead.
 
 Plus, the market is beginning to wake up to the massive troubles ahead for the rental-car industry…
 
This week, Bloomberg singled out the recent "panic" selling in shares of Stansberry's Investment Advisory short recommendation Hertz Global (HTZ). From the report…
 
As investor panic spreads about the plunging prices of used cars in the U.S., one company and its high-profile top investor are enduring the biggest beating: Hertz Global Holdings and billionaire Carl Icahn.
 
Hertz shares lost one fifth of their value last week, as a troubling reading for a used-vehicle price index was followed by warnings that lender Ally Financial and automaker Ford Motor see more pain to come…
 
"You have a long list of concerns and you can't give them the benefit of the doubt," Chris Agnew, an analyst at MKM Partners, said in a phone interview. "They're not even giving guidance."

 Of course, regular readers shouldn't be surprised…
 
As Porter explained back in the November 8 Digest, the same day Hertz shares lost half their value in a single trading session…
 
Today, the leading car-rental business in the world saw its share price fall more than 50% in the first few hours of trading. The collapse erased more than $2 billion from the accounts of some of the world's best investors, including Carl Icahn, who owns more than 12 million shares.
 
While some of the best investors in the world got hurt by changes they never saw coming in the credit markets, many of our subscribers saw their portfolios increase in value by huge amounts.
 
This is only the latest example of how our understanding of the credit markets greatly increases our ability to guide investors in the equity market. These credit trends are by far the most powerful force in the stock market. Ironically, however, they're largely invisible to virtually all investors – even the most sophisticated.

Following the latest decline, HTZ is now trading at a new all-time low of less than $18 per share. Stansberry's Investment Advisory subscribers are now up more than 30% on their combined short position in Hertz and Avis Budget (CAR) in less than six months.
 
 Before we wrap things up today, an important announcement…
 
We're only a few days away from what could be the most important and valuable event in our company's 18-year history.
 
On Wednesday, April 5 at 8 p.m. Eastern time, the "Metropolitan Man" – who has held just about every high-ranking economic position in the U.S. government – will join us live at our Baltimore headquarters.
 
At this meeting, the Metropolitan Man will not only reveal himself for the first time… He'll share details on a specific development that could have huge consequences for the markets and the U.S. economy over the next few years.
 
And you can be there… We're offering exclusive online access to this event for just $19.95. Click here to reserve your spot now.
 
Regards,
 
Justin Brill
 
Editor's note: On Wednesday night, Porter will hold an emergency briefing about the secret civil war that's going on right now between President Trump and a hidden power structure that's bigger – and more permanent – than any one president. Porter believes we're approaching our country's most dangerous period since the Great Depression. Guarantee your spot for this important event right here.

Source: DailyWealth