Home again

I'm talking about companies that own ample hard assets, have little or no debt, with businesses growing 25% a year, generating 25%-30% returns on capital... selling for three times cash earnings. I was salivating. Too bad the Indian government doesn't want my money in the country. I'd gladly give it to them, but for the time being, they're too paranoid and bureaucratic to take it.

I loved India. But it's great to be home. I had tons of excellent food and drinks there, but when I got off the plane from Delhi to Chicago, I went through customs and made a beeline for McDonald's. When I finally got back home to Oregon, I told my wife, "We're having pizza for dinner."

I can't get those words out of my head... "Gonna let it go back, like everybody else"... Maybe I'm being melodramatic, but to me, it sounded like, "Who is John Galt?"

Two houses over, it's the same story, with a divorce complicating the matter. Next to them, another divorce, but the woman living there seems to be holding onto her house for now. As I walk my dogs around the neighborhood, I see more and more empty houses with notices on the windows.

My modest little neighborhood is imploding. It was never very expensive, even at the peak. People must be suffering if they can't afford to live here. Southern Oregon was one of the biggest bubble areas in 2005-2006. Now it's cheap. You can get a two- or three-bedroom house in a decent neighborhood for less than $200,000.

In the issue, Matt details the biggest risk to your financial security that no one talks about. Considering much of Matt's research focuses on the oil complex, it's no surprise the risk comes from the Middle East.

You see, energy industry insiders – and the U.S. military – closely monitor a small waterway known to locals as Tangeh-ye Hormoz. This stretch of water, which hugs the southern coast of Iran, is the most important "chokepoint" in the seaborne global oil trade... which makes it the most important waterway in the world. More than 16 million barrels of oil pass through here every day – more oil than China, Japan, and Germany consume in one day combined.

Yes, you read that correctly: The most important waterway in the world – the valve through which most of the Middle East's oil flows to the U.S., Europe, and Asia – is located in the backyard of the most belligerent state on Earth. A small military escalation here, involving Iran, terrorists, or fellow belligerents the U.S. and Israel, could immediately send the price of oil to more than $150 or $200 per barrel.

Ferris comment: I understand your point. It's hard to forget the guy who said, "If you're not part of the solution, you're part of the problem" was murdered for speaking out.

But the Ponzi scheme analogy connecting Madoff and the government is still valid, in my opinion. Madoff's actions reduce to simple theft, just like the government. He stole with guile, whereas the government steals at gunpoint.