The War on Your Wealth

$2,500 gold by Christmas?... Math that still works... The war on your wealth... Why you need to protect it... Government spending keeps adding up... How to fight and win... Watch our special 2020 pre-election briefing right now...

Two weeks ago, we mentioned that we've been producing more video content than ever...

We also noted that we would begin sharing more of these exclusive insights on a regular basis here in the Digest. And that's exactly what we want to do today...

We're highlighting new Stansberry Research editor-at-large Daniela Cambone's recent interview with gold bull, industry veteran, and author E.B. Tucker.

The name might sound familiar to longtime readers... E.B. is a former Stansberry's Investment Advisory analyst. Nowadays, he's a director for gold-royalty company Metalla Royalty & Streaming (MTA).

In the video, E.B. explains why he believes gold will hit $2,500 by Christmastime, talks about the "gold vs. bitcoin" debate, and details why he thinks the Federal Reserve "can't ever raise rates again."

You can click here or on the image if you want to go right to the video. And then, we'll get into all the details below...

If you've followed along with us this year, you know many of our editors are also bullish on gold...

Our founder Porter Stansberry and many of our editors have said for years that it's always a good idea to hold at least a portion of your overall portfolio in the precious metal as a "chaos hedge" – and that it's especially important during a bear market.

What we've seen so far this year has proven that to be a smart idea once again... The unprecedented amount of government stimulus that arrived with March's stock market crash and easy-money policies made "hard assets" like gold more valuable.

And the trend is far from over...

All the way back in April, Gold Stock Analyst editor John Doody – who has seen a few of these cycles through his decades in the industry – called for gold to nearly double from its March bottom to $3,000 or higher... and for related gold stocks to take off even faster.

We couldn't have been more clear on John's case for gold months ago, when we wrote in the April 27 Digest, "why you should own gold stocks now... and the smart way to do it." In that essay, we said massive amounts of government stimulus would serve as fuel for a big move higher. As we wrote back then...

In the years following a crisis, the prices of gold and high-quality gold stocks soar...

It happened after the U.S. went off the gold standard in 1971... It happened again from 2001 to 2004 after the dot-com bubble burst... And it happened yet again after the financial crisis, when the Fed used bazookas that don't even compare to the trillion-dollar ones they've used this time around...

As John put it, if gold's gain from 2008 to 2011 repeated, the price of the precious metal would soar 123% to $3,423 per ounce. Today, an ounce of gold costs about $1,880... up about 25% from its March bottom, but still with roughly 80% more upside to be had if it's heading to John's expected level.

So with that said, this probably isn't a new discussion to a lot of you. But the way E.B. framed the same concept in his interview with Daniela might be...

According to E.B., this is simple economic math that is still applicable in a world of 'unlimited QE'...

As he told Daniela, the scale of what we're talking about is mind-boggling...

The entire gold market, every ounce of gold ever mined in human history, is only worth $12 trillion. This year, you've seen $3 [trillion] to $4 trillion in stimulus go out the door... You're looking at maybe $2.2 trillion more.

You've almost had a deficit in the U.S. of half the gold on the whole planet.

When you look at it this way, why wouldn't the price of gold double? In other words, it's just as John projected back in April.

Like John, E.B. said he believes we're still in the early stages of the next great bull run in gold...

This is coming in dominoes. Numerous dominoes have to fall. We're only about three innings into the baseball game. There's six innings left to go. There's a lot that's coming next.

Of course, that includes next Tuesday's presidential election, which E.B. said will be good for the bullish thesis for gold and other hard assets no matter who wins...

The election is so bullish for gold. It doesn't matter what happens. A Trump victory for a second term is bullish for gold in different ways. A Biden victory is bullish for gold in other ways.

The U.S. Treasury just can't borrow enough money. They've never seen a dollar they didn't want to borrow.

Bigger picture, the 'war against your wealth' is on...

In May, E.B. published a new book, Why Gold? Why Now? The War Against Your Wealth and How to Win It. (You can find it on Amazon right here.)

As he told Daniela, the book is a culmination of everything he has learned about gold in his investing career so far. By the time you're done reading it, E.B. says, you shouldn't even need to listen to him anymore because you should understand the bullish case for yourself.

E.B. also talked with Daniela in depth about the themes we've discussed here in the Digest this year – namely near-zero interest rates and unimaginable amounts of government spending, what that means for individual investors, and why the world's governments will keep doing what they're doing...

People need to understand this is a debt-based system... If you shrink, everything rattles and it falls apart. Companies can't refinance their bonds. People can't refinance their mortgages. Houses go down in value. Everything crumbles. Pension funds, you name it. Top to bottom, everybody has a hard time.

This system has got to grow. The question is, can they control the rate of inflation?... The U.S. is shrinking on a real basis and growing on a nominal basis. You've got to preserve your wealth.

For individual investors, this means building a true all-weather portfolio by considering investments (like gold, bitcoin, real estate, and the stocks of capital-efficient companies) that will do the job of protecting your wealth for you.

Because owning traditional stock and bond investments (the latter of which are yielding next to nothing today) isn't likely to do it.

Dr. David 'Doc' Eifrig described it another way in his latest issue of Income Intelligence...

After the "Melt Up" that our colleague Steve Sjuggerud is calling for eventually turns into a "Melt Down," Doc and his research team "expect a good stretch of sideways markets" given how high stock valuations are today. From the October issue of Income Intelligence...

If you thought you could earn 7% or 8% in an investment account, you need to reset your expectations.

Valuations don't help us time the market direction in the short term, but if you buy when stocks are rich (like they are today), you should expect to earn less over the next five to 10 years...

In fact, as Doc continued in the issue...

With today's price-to-earnings ("P/E") ratio at 26, we're looking at something akin to returns of -5% (yes, that's a minus sign) per year, if history is a guide.

You can still own stocks during this period... You just want them to be the right ones. Stick to quality and fair prices, avoid the trendy names, and be prepared to hold for the long term.

When it comes to bonds, it's hard to pull out of the market. Bonds typically balance the bulk of a healthy portfolio. However, while you shouldn't dump every bond fund you hold, you need to think about whether it's the safe asset class that it used to be.

And as E.B. put it in his recent discussion with Daniela...

This is a war against your wealth... and if you have even $1,000, that's wealth.

We hit some of the big points of Daniela's interview with E.B. here today, but again... The entire video is well worth a watch or a listen. You can do that on our YouTube page right here. (And be sure to subscribe to our YouTube channel for the rest of our free videos, too.)

As we said yesterday, these kinds of big-picture 'forces' are likely to be in place for the next few years...

It doesn't take very long to find proof...

Within five minutes of watching Daniela's interview with E.B. earlier today, we saw a headline that said Medicare (in other words, taxpayers) will be covering the cost of all COVID-19 vaccinations for its beneficiaries, now also including vaccines that are approved early for emergency use only. (This is different from what standard Medicare rules allow.)

If everyone on Medicare were to get vaccinated (most Medicare recipients are older than 65 and thus considered "higher risk" for COVID-19), the cost would be an estimated $2.6 billion, according to the U.S. Centers for Medicare and Medicaid Services.

Put it on the tab! Like compound interest, it all adds up over time.

It's the same story in Europe, too...

Today, we also learned that the European Central Bank ("ECB") is planning to keep interest rates where they are (low) and may do more stimulus in December... as countries like Germany, Italy, France, Greece, and Spain have reimposed curfews and lockdown measures in an effort to contain a resurgence of COVID-19 infections there.

For instance, officials in Madrid – Spain's capital and most populous city – and other parts of the country have banned all but essential travel in and out of their regions.

As Daniel Smoot of our Stansberry NewsWire team shared this morning, ECB President Christine Lagarde said after the central bank's latest policy meeting today that it plans to use "all of the tools" at its disposal to support the European economy, depending on what happens over the next two months. As Lagarde said...

We have done it for the first wave, [and] we will do it again for the second wave.

If you needed any more confirmation about how the world's central banks are thinking and what governments are expecting today, there you go...

Like E.B. told Daniela, this is the war against your wealth in plain sight...

On one side is the Fed and other central banks with their bazookas. On the other side is you. That brings up an important question: How do you fight, and more importantly, win?

First, you need to know that we do have weapons... And that's the knowledge that this is all happening in the first place. This is why our editors and analysts talk about these developments so much...

We've been sharing the latest news surrounding this concept all year long – and for the better part of the past decade, really... Just knowing about what's happening is half the battle.

But knowledge is even more powerful if you know how best to put it into action...

In his book, E.B. makes the bullish case for gold, which we of course agree with. However, he also makes an important distinction about how to think about gold if you're a believer...

There's thinking of it as a wealth preserver, like most people do – and that's fine. But then, there's a way to make profits from a rising gold price, too... through gold-related companies that can make exponentially more money every time the price of gold goes up.

As we've shared before, these are the types of stocks – which benefit from their leverage to gold – that John has so successfully recommended in his Gold Stock Analyst newsletter over the last three decades.

As John told attendees of our Stansberry Conference earlier this month, his model portfolio of high-quality gold stocks has returned a cumulative 1,211% since 2000. Learn more about Gold Stock Analyst here if you don't already have a subscription.

But there's more than one way to fight these battles...

We can't think of many more people who have been sounding the alarm on this "war" over the decades than former presidential candidate Dr. Ron Paul. He should be a familiar name, too... most recently as a speaker at our annual Stansberry Conference.

What he preaches aligns with a lot of what we've talked about today... And as we noted yesterday, Dr. Paul recently sat down with our Director of Research Austin Root for a special 2020 pre-election briefing.

Together, they talked about the macroeconomic picture... government spending... what the election will or won't mean for stocks... and what you can and should do about it to protect your portfolio and grow your investments in the aftermath.

Gold is part of the discussion – which shouldn't surprise anyone who has followed Dr. Paul's career – but so is a lot more...

As we said in yesterday's Digest, over the medium and long term, presidential elections don't directly influence the stock market one way or another. (Political and legislative influences are a different story.)

But in the short term, an election can move certain stocks and sectors of the market for better or worse. And over time, policies and spending can add up and influence stocks (or Fed governors) in the longer run.

In the context of all this, Austin has identified a series of stocks that will do well no matter who wins next Tuesday, as well as a handful of companies that specifically stand to benefit from just one candidate's win – some tailored to a second Donald Trump term and others to a Joe Biden administration.

As we inch closer to Election Day, be sure to watch our pre-election briefing for free right here, right now.

New 52-week highs (as of 10/28/20): Rollins (ROL).

In today's mailbag, feedback on yesterday's Digest about what an election means and doesn't mean for stocks. Do you have a comment or question? As always, you can e-mail us at feedback@stansberryresearch.com.

"Historical presidential data is worthless... This is not a typical election. Our Republic and the Constitution of the United States is at risk. Many corporations have become the enemy of the Constitution because they have become accustomed to the pay to play tactics of the left and want to build on the monopolies." – Paid-up subscriber B.T.

All the best,

Corey McLaughlin
Baltimore, Maryland
October 29, 2020