Tag Archive | "dollar index"

Dollar’s Strength


The Dollar Is Still King.  How (in the World) Did That Happen?

Yesterday’s message Value vs. Growth looked at how many overseas stock markets are much better value than US shares.  Part of US share’s poor value is due to a strong US dollar.

Knowing why the dollar has been strong might help us understand how to profit when the greenback falls… as I believe it will.

In 1968 I left the US and started living, investing and doing business globally.  Here are some of the pages in my first passport.  (I have used up many more passports since!)

passport

In May 1971 one of my most important experiences taught me a lesson about trusting a strong US dollar.

I will never forget this currency survival lesson when the dollar was unpegged from the Bretton Woods Agreement.   I recall it well. I was in Singapore in early May 5, 1971.

Little did I know that this was a week that would change the world… for the worse.

I was staying at the Raffles Hotel, a famous historic site.

raffles

At that time the hotel was colonially faded but offered a great outdoor restaurant just next to the Long Bar (home of the Singapore Sling).   They offered a traditional breakfast with old fashioned pots of thick cut marmalade and slightly burnt toast that stood in racks of sterling silver.  This elegant setting and the quiet service was an easy, wonderful way to start the day.  I felt in place, relaxed and comfortable, part of an ancient tradition, the modern link in a rite that this hotel had offered prosperity for so many generations past.  I sat back feeling that all was well.  I felt in control and on top of that modern era.

However, everything suddenly changed as I was about to learn a serious lesson in international currency safety.

I settled in for breakfast,opened the local paper (the Straits Times) and saw the four inch headlines that declared “U.S. Dollar Devalues”.

That comfortable era had just come to an end.  Currencies around the world were in turmoil.

That day, when the dollar devalued, money changers would not take the greenback.  I couldn’t pay for my hotel.  I couldn’t even pay for breakfast and I was 12,000 miles from home.  I had just moved into a new reality of freedom loss and was scared!

Since that day I have never trusted the US dollar or any other single currency.  This has reaped rich rewards.  Betting against the US dollar when it was strong (as I have again and again over these five decades) has been exactly the right thing to do.

This is why at our website we continually look for ways to gain protection from the loss of purchasing power in all currencies.

A recent New York Times article “The Dollar Is Still King.  How (in the World) Did That Happen?” (1) can help us understand the value of the dollar.

The article says: A cursory assessment might find the United States a less than ideal candidate for the job of managing the planet’s ultimate form of money.

Its public debt is enormous — $22 trillion, and growing. Its politics recently delivered the longest government shutdown in American history. Its banking system is only a decade removed from the worst financial crisis since the Great Depression.

NYT.com

But money tells a different story. The dollar has in recent years amassed greater stature as the favored repository for global savings, the paramount refuge in times of crisis and the key form of exchange for commodities like oil.

Because banks cannot risk jeopardizing their access to the plumbing of the dollar-based global financial network, they have taken pains to steer clear of nations and companies deemed pariahs in Washington.

China has sought to elevate the role of its currency, the renminbi. But its economic slowdown, restrictions on taking money out of the country and detentions of foreigners have tested its currency’s appeal.

The most formidable competitor to the dollar has long been the euro.

But the most trusted euro-denominated investment, German government bonds, are in chronically short supply. With a deep cultural aversion to debt, Germany has been reluctant to finance spending by selling bonds. As a result, investors seeking ultrasafe places to stash savings have very few options in the euro currency. By comparison, American savings bonds are in virtually limitless supply.

Over the same time, reserves entrusted to the euro have slipped to 20 percent from 27 percent. Much of this shift reflects the euro’s loss of value against the dollar. China’s currency makes up only 2 percent of total reserves, according to the I.M.F.

There are no forevers in the global economy, making this era no more permanent than any other.

But while that may be the future, the dollar for now remains what it has long been — the closest approximation to a sure thing in a volatile global economy.

So for now the greenback is the royal currency.

However a chart of the US dollar index, at macrotrends.com (2), shows that, since its 1971 devaluation, the strength of the dollar has come and gone in waves and it is now looking like its at a peak.

macrotrends.com

This means that now is a good time to borrow dollars and invest in non US shares or precious metals.

I explain more about this below.

Gary

Borrow Low – Deposit High

Turn $250 into $51,888… in Four Years or Less.   If someone offers you a deal like this, I would normally say “Run as fast as you can!”

Yet in 1986. This is exactly what I wrote in a report, The Silver Dip”  that told how to borrow British pounds to buy silver.  I must admit it. I was wrong. Readers who followed the report made nearly that amount ($46,299 to be exact) in only one year!

I have been updating this report since.  The last update showed how to get 2% loans that turned $39.95 into $28,185 profit.

Now is the time to borrow low and earn high again because… an amazing investing trend is taking place.

Most investors will miss it.   You do not have to lose out.

Let’s take a look why.

I have been helping readers use a little known, easy loan investing technique for over 30 years.   Almost any investor can get the loans.

The $39.95 is for a report that explains how to borrow $10,000… no loan application required.   You’ll  get the lowest interest rates in town according a Barron’s online review.

Right now the loan interest rates are between 1.41% to 2.66%.

Here is what happened the first time I issued this report over three decades ago.

The year was 1986.  The price of silver had crashed, I mean really crashed from $48 per ounce down to $4.85 in May 1986.  

Everyone was afraid of investing in silver.

But I had been investing and writing and speaking about global investments since 1968.   When I issued the Silver Dip in 1985 I  had nearly 20 years of experience, so knew that when fear rules a market, the chance of profits are high.

As prices decreased from early 1983 into 1986, total supply of silver had fallen to 449.7 million ounces.  Mine production was restricted by the low prices at that time.  Secondary recovery of silver was constricted by low prices as well.

Then a “special silver pricing position” fell into place.

I showed readers how to borrow 10,000 British pounds at cheap interest rates, to invest in silver.   A British pound at that time was worth $1.86 so the loan was sufficient to buy 3,835 ounces of silver at $4.85 per ounce.

Silver’s price skyrocketed to over $11 an ounce within a year.  By 1987 the 3,835 ounces of silver was worth $42,185.

The profit did not stop there!

The loan was in British pounds.  By May 1987 the pound had dropped from $1.86 per pound to only $1.40 per pound.  The 10,000 pound loan that had been worth $18,600 in 1986 only required $14,000 to pay it off in 1987.

The falling pound had created an extra $4,600 profit.

Do the math: 

Silver worth $42,185

Loan payoff  $14,000

Profit             $28,185

Cash Required  Zero

All of this profit was made on the 10,000 pound loan.  No extra cash was required on the investor’s part.

The $28,185 was pure… extra profit.

Let me add that some investors had borrowed even more.  Some less.  The report showed a loan to risk formula that investors could follow.

That was in the 1980s.  Silver’s special pricing position” does not happen often (this is why most investors miss it).

Nearly 30 years passed before the “silver’s special pricing position” fell into place again.

Conditions for the silver dip returned 30 years later in 2015.  The availability of low cost loans and silver’s price were perfect.

With investors watching global stock markets bounce up and down, most missed this important profit generating event. 

My readers did not.

I had been watching the entire 30 years for “silver’s special pricing position” to return.

I had been watching currency shifts and interest rates distortions so I knew the best currency to borrow.

From 2011 to 2015 the price of silver had once again crashed from $48.35 to below $14 an ounce.

The “special silver pricing position” reappeared.

I dusted off the “Silver Dip” and updated it to the “Silver Dip 2015”.

I prepared a “Silver Dip 2015” report and shared it immediately.  

The report paid off again.

From July 2015 to July 2016, the price of the silver ETF  iShares Silver Trust (Symbol SLV) rose from $13.92 and ounce to $18.71.  You can see the rise in the finance.yahoo.com chart below.

yahoo

A 10,000 pound loan (the pound was $1.52 per pound) purchased 1091 shares of the silver ETF SLV.   Those Shares rose to be worth $20,421 by 2016, a 34.34% additional profit.

The profit did not stop there!

The loan again was in British pounds.  From 2015 the pound dropped from $1.52 dollars per pound to only $1.39 dollars.  The 10,000 pound loan that had worth $15,200 in 2015 only required $13,900 to pay it off in 2016.

yahoo pound chart

The falling pound had created an extra $1,300 profit.

Do the math: 

Silver worth $20,421

Loan payoff  $13,900

Profit             $6,521

Cash Required  Zero

All of this profit was made on the 10,000 pound loan.  No extra cash was required.

Again this was pure… extra profit.

Some investors borrowed less… others borrowed much more so their profits were even higher.

All the extra earnings were derived from a low cost, easy to obtain loan that almost any investor can have.

I would like to help you learn how to tap into this type of profit that most investors will miss… in my newest report “The Silver Dip 2019”.

First let me answer a really important question…  that if you have not asked, you should.

Isn’t there some risk?

Yes.  There is always risk when you invest.

The first golden rule of investing outlined in the Silver Dip 2019 report is…”there is always something we do not know”.

The numbers above are what have happened.   We never know for sure what will happen.

2015 was similar to 1986.  Investors were afraid of silver.  Courage was required and this is exactly why dip investments work so well.

When most investors are afraid of a precious metal, extra good value is created!

Plus there is a way to dramatically increase the odds that your investment will be safe and that you’ll reap the type of high rewards I have described above.

The formula for increasing safety and improving the odds for profit are included in the new report, “Silver Dip 2019”.

The benefit of 50 years experience.

With so many years of experience in watching markets, metals, bonds, interest rates and currencies, I have learned many special pricing situations to watch for.

These special opportunities do not appear every day.  That’s why they are special.

Unless you have seen them come and go, it’s hard to see them coming again.

That is why I was willing to wait for years for silver to be in a special pricing position.

Our courses and reports are about finding good value and they have been helping astute readers find value investments, again and again for 50 years.

The “Silver Dip 2019” report shows a new, even bigger opportunity.  I continuously watch for aberrations in currency and precious metal markets.   Sometimes a rare quirk, such as we saw with the pound loans and the Silver Dip offer potential for profit, with very little risk of long term loss.

Investors who speculate on platinum at the correct time can make fortunes.

The time is now.

Success is almost guaranteed.  In fact an 89 year study showed a 99% change of success when sequence distortions are worked in a certain way.

We are stalking precious metal opportunity now.

The trap is set. We are waiting…

This opportunity is explained in the report “Silver Dip 2019”.

You can order the Silver Dip 2019 here for $39.95

Here is why there is no risk for you.  The report is 100% guaranteed.

I do not sell book, reports and courses.  I offer benefits.  If  the Silver Dip 2019 does not bring you the benefits you expect, just let me know within 60 days and I’ll send you a quick, no questions asked, full refund.

I can’t promise that silver’s price will rise in the next 60 days.  I can guarantee you’ll be fully satisfied with the report or… you can have your money back in full.

You can order the Silver Dip 2019 here for $39.95

Gary

 

(1) www.nytimes.com: US Dollar Currency Value

(2) www.macrotrends.net/1329/us-dollar-index-historical-chart