Porter's 'Rotten Economy' Survival Plan

The disconnect continues... Two things can be true... Porter's 'rotten economy' survival plan... Watch the replay of Porter's latest event... Doc's latest COVID-19 checkup... A 78% winner in less than a week for True Wealth Opportunities: China subscribers...

Something is 'rotten' in the United States...

As we said yesterday, you probably feel it in one way or another... And we do, too.

The major U.S. stock indexes continue to climb from March's bottom, while unemployment remains at record levels...

The politicians in Washington are getting ready to leave for "recess," and apparently can't even agree on how to spend another round of "free money" from the Federal Reserve before they do...

And today, second-quarter gross domestic product ("GDP") in the U.S. – the traditional measure of economic growth – was announced... It showed a decline of roughly 33% annualized, a record drop that actually beat analyst expectations by a few percentage points.

Oh joy.

Meanwhile, I (Corey McLaughlin) can't fathom how we're five months into the COVID-19 pandemic and my sick, confined mother-in-law still has to wait a week to get a test result... while the professional football players and staff a few miles away can take a test and get their results back every single day as part of the (antitrust-exempted) NFL's $75 million testing plan.

In other words, the disconnect between Main Street and Wall Street may never have been wider than it is right now.

What's happening today is startling Porter, too...

If you were one of the thousands who tuned in for his latest event this morning, you heard that in his words. (And if you weren't, we urge you to watch the replay for free right here.)

From his farm just outside Baltimore, our founder shared his observations, thoughts, and concerns about the ongoing COVID-19 crisis, and what everything will mean for your money and our country. As he said during the broadcast...

My favorite image so far of the crisis has been the lines around the block of delivery people at the doors of Michelin-star restaurants in New York City waiting to take the dinner to people.

You've got sort of two Americas... you've got the America that lives in penthouses and orders food from Michelin-star restaurants, and you have the poor people who have to risk the virus and wait in line to deliver it.

That juxtaposition, that is what's really driving the anger and the unrest and the malaise. And the problem is the way that the government's going to treat this problem is with more of the same medicine that got us here.

They're going to print more money, they're going to manipulate interest rates even lower, and they're going to continue asset price inflation... because it's the one weapon they've got.

As anyone who has studied American and world history could see, this situation leads to "rottenness," Porter said, manifesting in a less productive economy and more divided society. We're already seeing it...

The protests... the "cancel culture"... the blame game... the record numbers of people looking for work... and the rising numbers of restaurants and other small businesses that are "permanently closing." As Porter said...

They see a guy, no matter how much he worked and he saved, his wages could never keep pace with inflation. It didn't do him any good.

And when those things happen enough times, you have real anger and you have real distrust of the entire fabric of society.

As we've written a few times this week, every time the Fed creates a new dollar, the poor people in this country get poorer because they can only buy "less" with the same amount of money.

And as we've seen, the government thinks the best solution to those problems is to print more money...

Then, these same struggling folks get disillusioned with those who, frankly, have access to Wall Street and are better positioned to "get rich" by knowing why markets move the way they do...

Porter saw what was coming early on, as he often has. He was convinced back in March that stocks would soar to new highs once the Fed shot stimulus into the economy's sick body.

That's why back on March 26, while the world was ending, he told attendees of his most recent event that it was the perfect time to buy "forever stocks."

Today, 19 of the 20 stock picks he offered that day are up double-digits, including 10 that are up 30% or more and a few that are up more than 50%.

But two things can also be true...

Stocks can go up because of central bank money-printing and easy-money policies... and those same policies can erode the value of the U.S. dollar over time, causing all kinds of longer-term consequences – like higher taxes and a debt tab due to "we the people."

In the meantime, the benchmark Fed funds rate will probably remain near or at zero, if not negative, for at least the next few years... making it hard for everyday Americans to find a "safe" return on capital and pushing them into riskier stocks and asset classes.

Anyone with the ability to think longer than a quarter – individual investors like you and I, for example – can see that this is unsustainable for long-term "free market" economic growth... and at a minimum, this story can be dangerous for unprepared Americans' wealth.

As Porter said this morning...

It's a really simple problem when you understand the roots of it – which is, since the mortgage crisis, the Fed has tried to manipulate our economy by reducing interest rates artificially.

And as regular Digest readers know, the Fed has added new weapons to its manipulation arsenal...

Since mid-March, the "lender of last resort" has spent about $4 billion alone buying shares of three corporate-bond exchange-traded funds – the iShares iBoxx Investment Grade Corporate Bond Fund (LQD), the Vanguard Short-Term Corporate Bond Fund (VCSH), and the Vanguard Intermediate-Term Corporate Bond Fund (VCIT).

That's right... the Fed is indexing, too!

And we're supposed to think everything is going well?

Instead, let's think about how this truly unprecedented government intervention in the U.S. is all going to ultimately impact our economy. As Porter said this morning...

That's what I'm mostly concerned about right now and that's what I want to raise awareness about.

This morning, Porter shared his guide for surviving – and thriving – during the inevitable fallout...

The plan, of course, includes owning shares of high-quality, capital-efficient companies that you know and love for the long term. Longtime subscribers and Digest readers have been hit over the head with this concept because it works...

And Porter likes high-quality shorter-term corporate bonds, too. Regular readers know he has also recommended high-quality foreign currency in the past to protect your portfolio. But as Porter explained this morning, he has moved on from those assets...

Because every central bank and every government around the world, every developed country, has gone bankrupt.

Instead, Porter is looking at what some might consider a more speculative currency play... but it's a big idea that makes a whole lot of sense if you understand today's market environment, and how money moves and changes in value.

He calls this "the best currency for the Information Revolution," and he doesn't mean the U.S. dollar... because capitalism is in crisis.

During today's special briefing, Porter explained why he strongly believes you should allocate at least part of your portfolio to one particular type of investment, and he shared precisely how best to do it.

Tonight, I can report that thousands of folks have already taken Porter up on his advice, and we expect many more will do the same after listening to what he has to say.

We could go on and on about the presentation, but we recommend you just watch it for yourself. Again, it's absolutely free and well worth the time... especially if you're thinking "big picture" about your money today like we are. Click here to watch the replay right now.

Moving on, we're due for another COVID-19 checkup...

In the short term, our editors are going to continue to track the COVID-19 "numbers" because they remain the biggest driver of this rotten economy...

Despite everything else going on this week – Big Tech CEOs testifying before Congress, news in the vaccine race, the president tweeting that he wants to delay November's election – we haven't forgotten that Fed Chair Jerome Powell said months ago that until the COVID-19 data improved, the economy won't recover either...

Powell also notably said that Fed governors were tracking the disease data just like everyone else. And most important, when it comes to our money, they'll keep juicing stocks and the debt markets until the numbers improve dramatically...

For the big-picture analysis on the latest COVID-19 developments in the U.S., trends in cases (plateauing), deaths (up), jobs numbers, testing (delays), treatments, and what it all means for the economy and markets, we turn to Retirement Millionaire and Income Intelligence editor Dr. David "Doc" Eifrig and his research team...

We suggest you check out Doc and senior analyst Matt Weinschenk's latest COVID-19 briefing, now the 17th in their series, which they just published today. In summary, they say...

The "V-shaped" recovery has stalled.

But they also show what might come next... that the "trouble" states have had some good news lately, why "chaos hedges" like gold have been soaring, and findings about a new, noninvasive test for COVID-19. You can watch Doc and Matt's full briefing right here.

And finally today, Steve Sjuggerud's team just booked another huge winner in China...

Before we sign off, we want to give some kudos to Steve and his Asia-based analyst Brian Tycangco for their recent work in True Wealth Opportunities: China. (You can also hear from Brian in today's featured video below.)

For the uninitiated, Brian joined Steve's team a little more than a year ago. And since then, he has been producing great work. Like all of our editors, he has a unique investing perspective... Specifically, he offers tremendous expertise in Asian markets.

Brian has focused on finding little-known Chinese companies with big upside. And there's no brighter example of his hard work paying off than what happened over the past week...

As True Wealth Opportunities: China subscribers know, the ink had barely dried on their latest issue – sent last Thursday – when shares of Brian's recommended investment, Internet-search company Sogou (SOGO), shot up 78% in three trading days.

News that Chinese conglomerate Tencent (TCEHY) announced plans to buy the company for $9 per share served as the catalyst. This might have been surprising news to a lot of market observers, but it wasn't a surprise at all to Brian's readers.

In this month's issue, Brian wrote that Tencent was already a major shareholder in Sogou, the second-largest Internet-search company in China. And that fact is what set the stage for Sogou's long-term opportunity.

Brian said that Sogou had a real shot of becoming China's version of Google for the next 20 years, in fact. As he wrote in the original issue...

Few thought Google would be as ubiquitous as it is today when it started out. But the company did the unthinkable. And Sogou's future could be just as surprising...

Things are moving faster now than anyone would have expected, but Brian's thesis was obviously spot-on and arrived in subscriber's inboxes with impeccable timing.

On Tuesday, Brian sent an update to True Wealth Opportunities: China subscribers on what to do with their shares after the news of Tencent's plans to buy the company.

He said it might feel odd, but the best thing to do right now was to close out the trade because the upside from here didn't warrant the risk of holding. As Brian wrote...

The $9-a-share offer is roughly 6% higher than the last closing price. And that means if we sell today, we'll be able to lock in a huge short-term gain without leaving much potential profit on the table.

Indeed, a 78% gain in a week is not bad at all.

That's great work all around – and just the kind of little-known opportunity, expert analysis, and guidance that Steve and his team give True Wealth Opportunities: China subscribers. If you're interested in joining them, click here for more information.

The 'New Nasdaq' Is Online

After China's STAR 50 Index (its version of the Nasdaq Composite Index) opened recently, our colleague Jessica Stone spoke with Brian Tycangco of True Wealth Opportunities: China about how U.S. investors can benefit from Beijing's stock market management.

Click here to watch this video right now. For more free video content, subscribe to our Stansberry Research YouTube channel... and follow us on Facebook, Instagram, and Twitter.

New 52-week highs (as of 7/29/20): American Tower (AMT), Sprott Physical Gold and Silver Trust (CEF), CoreSite Realty (COR), Digital Realty Trust (DLR), Expeditors International of Washington (EXPD), Fidelity Select Medical Technology and Devices Portfolio (FSMEX), SPDR Gold Shares (GLD), GrowGeneration (GRWG), Green Thumb Industries (GTBIF), iShares U.S. Home Construction Fund (ITB), Lonza (LZAGY), Osisko Mining (OBNNF), O'Reilly Automotive (ORLY), Flutter Entertainment (PDYPY), Procter & Gamble (PG), Sprott Physical Gold Trust (PHYS), Rollins (ROL), Scotts Miracle-Gro (SMG), TFI International (TFII), Tudor Gold (TUD.V), and Vanguard Inflation-Protected Securities Fund (VIPSX).

In today's mailbag, feedback on yesterday's Digest about the "four turnings" of life. Do you have a question or comment? As always, send your e-mails to feedback@stansberryresearch.com.

"I read [The Fourth Turning] years ago – fantastic read. When I saw all this happening these past few years, and now the crisis, it confirmed my belief that we were in the 4th turning. When I read it in your newsletter, I just hmmmm'd. I look forward to hearing what you have to say about protecting ourselves during this hard time." – Paid-up subscriber S.D.

"Corey McLaughlin's remarks made me think. Remember, the last time we elected a Republican businessman who liked tariffs on imports, we got the Great Depression, and World War II about 10 years later. Has the Greater Depression actually begun this year, but temporarily held off by actions of Congress and the Fed? Should we be moving to the country and building fallout shelters for 2026?" – Paid-up subscriber Chuck B.

"Very nice Digest, Corey! This idea of four stages to 'saeculums' is similar to Bill Bonner's study of the rise and fall of empires. He quotes a scholar (whose name eludes me) who divides empires into four stages. It's worth a read. Keep up the great work!" – Paid-up subscriber Andy L.

Corey McLaughlin comment: Thanks for the feedback and kind words. Like I wrote yesterday, the theory is the most compelling one I've found to explain why so many different big turning-point events happen when they do.

All the best,

Corey McLaughlin
Baltimore, Maryland
July 30, 2020