If the End of the 'Melt Up' Is Coming... Now What?

'Meme stocks' or bust... If the end of the 'Melt Up' is coming, now what?... Securing your future doesn't mean giving up on returns... Using this asset as a tax haven... A brand-new special offer on one of our most exclusive products...

I (Vic Lederman) don't mean to be overly dramatic, but the 'Melt Up' is in its final innings...

In our free DailyWealth e-letter last July, I warned readers about the dangers of "meme stocks"... only they hadn't yet earned that title yet.

Back then, it was just some kooks piling into near-bankrupt companies like car-rental company Hertz Global and mall retailer JC Penney. And I explained flatly that this behavior wasn't "investing" at all...

It was gambling, plain and simple. And it still is today.

Steve knows this, too. And it's why he has pivoted his thinking on the Melt Up. He covered his thoughts on this shift, in detail, just two days ago in the Digest.

The siren call for bad bets is getting stronger by the day. And as the Melt Up works through its final stage, it's going to reach a crescendo.

That's the problem we face as investors right now... The further along we get in the Melt Up, the harder it's going to become to make good decisions with our money.

So am I telling you not to gamble?

Absolutely not... A little speculative betting can be healthy and appropriate as long as you've got everything else squared away. But my point is, you need an investing foundation to mitigate the risk of those bets...

More specifically, you need to understand what you'll do with your money when the "Melt Down" arrives. Going broke in retirement isn't an option for anyone.

And even though it might not feel like it, the risk in this market is greater than ever...

Fortunately, this doesn't mean you need to give up on growing your wealth...

As Steve explained on Wednesday, real estate is one of the answers for growing your wealth during a stock market Melt Down.

Now, it's possible that you think real estate investing means low returns. Or maybe you learned in the past that the best deals – the ones that are truly lucrative – are off-limits to all but elite investors.

Well, that's simply not the case...

In True Wealth Real Estate, as I touched on in yesterday's Digest, I've covered multiple opportunities designed to double investors' money in just a handful of years. And those are conservative numbers backed by the business plans of real estate titans... not outlandish estimates.

It's possible to uncover these opportunities because we're working with some of the best developers in the business. We call them "sponsors"... And we've worked with sponsors that have literally billions of dollars in real estate investment experience.

Think about that for a second... When was the last time you got to invest in a limited-offering deal managed by a multibillion-dollar enterprise?

For most of us the answer is an obvious "no"... But I bet you wish you had the chance.

That's why I'm writing to you today...

You do have that chance.

I want to make sure you know that opportunities like this exist out there in the world. And they have the legitimate power to grow your wealth, even during a stock market Melt Down.

Today, I'd like to show you what that looks like. I'm "pulling back the curtain" to let you see some of the actual deals that True Wealth Real Estate subscribers are using to grow and protect their wealth right now...

We're talking about market-beating returns in real estate...

One of the first opportunities I covered was the Lakes of Margate project in the Miami suburb of Margate, Florida. We told subscribers about this project last September.

It might sound silly, but I still get excited thinking about this deal...

You see, the real estate investment trust (REIT) that owned this apartment complex deferred remodeling as long as possible.

Now, this isn't a terrible strategy as an owner... It keeps costs down.

But there's a trade-off... Rents tend to fall below market. This creates a perfect setup for a "value add" focused real estate investor like the sponsor of this project.

You see, the Lakes of Margate site itself is beautiful. And heading into last fall, despite the ongoing COVID-19 pandemic, surrounding rents had indeed climbed.

I saw the beauty of this complex firsthand as I toured the property with a representative from the sponsor LYND. Take a look...

This 280-unit "garden style" complex was due for a remodel. But the location itself is everything a working family would want.

The REIT that owned the Lakes of Margate project was ready to exit. And LYND, the sponsor, was willing to take over and do the renovations.

That's the kind of project that LYND specializes in... The company has overseen more than $4 billion of transactions.

The way this particular deal itself worked was simple...

LYND would buy the property, remodel it, and sell in a few years.

After the remodel, LYND would be able to raise the rents for tenants to market prices. The increased cash flow over the life of the project would pay for a significant portion of the project costs... And it would make the building much more valuable when sold.

The net effect for investors is stunning. First, there's the cash-yield component...

Investors would see continual payments from this project. And with average annual yields of roughly 10%, it presented an incredible cash-flow opportunity.

All in, LYND planned to take roughly $18 million of investor cash and turn it into more than $34 million. That works out to an internal rate of return (IRR) of 17.2% and an overall return of 90%... In other words, this project offered a near double in just five years.

What more, it's common in real estate deals for the sponsor to get a bigger cut as the project does better...

Usually, this extra cut starts when IRRs jump above 8% to 10%. It's how sponsors get rewarded for producing market-beating returns on their projects.

In the case of the Lakes of Margate deal, LYND was willing to hold off on that cut until the project exceeded a whopping 17% IRR.

IRR is one of the ways to measure real estate investment performance. It solves the problem of time and gives investors an annualized number, regardless of the length of the project.

This means that LYND – again, a company with more than $4 billion of experience – was so confident in its ability to execute this project that it was willing to forgo its bonus until the project exceeded 17% a year in returns.

And again, this doesn't include crazy assumptions, unwieldy amounts of debt, or excessive risk. It's about the safest 17% annual return that you'll find anywhere.

It's exactly the kind of wealth-building investment you should look for as the Melt Down approaches...

And it's not a one-off situation, either...

Most of the investment opportunities that I've covered in True Wealth Real Estate come with targeted returns designed to double your money in just a few years. And they've covered a diverse set of assets, too...

There are opportunities in everything from the smoking-hot warehouse sector to "value add" projects like the one we just reviewed to new, "ground up" mixed-use projects.

Let's take a look at one more project before I let you go today...

What the heck is an 'Opportunity Zone'?...

When I moved to Florida to work with Steve a few years ago, I lived in an Opportunity Zone.

I didn't know it at the time. I just knew the Florida house that I rented was newly built... And it was huge compared with my home in California.

The Florida neighborhood was built around the peak of the housing boom. Nothing about the area said, "This place needs investment incentives."

The homes were nice. The brand-new shopping center just blocks away was nice, too.

Heck, the area is in the ninth-fastest-growing county in Florida. And the median household income for that entire Opportunity Zone is $83,000 a year. That's about 22% higher than the national median.

That didn't stop Florida from designating it as a low-income Opportunity Zone. And the federal government went along with it. So, when I saw a similar setup unfolding in Texas, I knew that I had to share it with our True Wealth Real Estate subscribers.

I'm talking about a decade of double-digit distributions with a near-zero tax bill...

Greystar, another heavy hitter in the real estate world, sponsored this project in Texas. The company has more than $35 billion in assets globally.

And even better, it's a local expert in the Houston area. This is exactly what you want for an Opportunity Zone real estate deal like the one I identified back in December. Take a look...

Those are all the rentals available through Greystar's apartment finder in this area. So as you can see, "local expert" is a bit of an understatement.

The company is building a master-planned community. It's a major project – the kind that would normally be off-limits for normal investors... But in True Wealth Real Estate, we were able to get in on it.

You might think a big project with a well-established sponsor like this would net bond-like returns to investors... but you'd be wrong.

Greystar designed the project to hit an IRR of 15%. And it's paying out those near-market-doubling returns over the next decade. This is what the targeted cash returns look like on that project...

Now I get it, the market has been hot. These numbers don't seem that impressive. But this is simply amazing...

It means subscribers of True Wealth Real Estate who followed our advice on this project will likely double the stock market's historic performance of roughly 7% for a decade.

Do you think the stock market is going to double its historic returns over the next decade? I didn't think so.

To me, if you're looking for an ideal way to secure your wealth over the long term... this is it.

And in True Wealth Real Estate, we focus on bringing deals like this to the table every month...

There's a lot of volatility out there.

The mainstream media and all the market commentators make it feel like the whole world is a "get rich quick" scheme. And I understand... Right now, planning ahead might be the furthest thing from your mind.

But securing your future doesn't mean sitting on a pile of cash.

There are investment opportunities available to you that live outside of the Melt Up. I'm talking about the kind of opportunities that will thrive in the coming Melt Down...

You can choose to preserve your wealth through the end of the Melt Up. You don't have to ride the peak all the way to the bottom like many unfortunate investors will do.

Better still, real growth is very possible. The opportunities we covered today are not anomalies... You can ride out the other side of the Melt Up and see your wealth thrive in the process.

True Wealth Real Estate is our way to bring the highest-earning, lowest-risk opportunities we can possibly find in the real estate space directly to our subscribers.

Each deal features highly experienced sponsors. Many of them have literally billions of dollars in real estate successes behind them. And for each deal, a full prospectus is available that details every aspect of the sponsor's business plan.

It's possible that real estate has been an asset class you've simply ignored as an investor...

Or maybe you've simply thought it was all too complicated and not worth the hassle.

But over the past few days, I hope you've seen that investors have access to deals unlike they've ever had. And we'd like to show you exactly how to take advantage of them.

As we've explained, Steve is now calling for the end of the Melt Up as soon as later this year. And we know that the macro tailwinds driving the market forces are shifting.

For that reason, Steve and I recently worked to put together an exclusive offer for Digest readers...

Right now, you can access True Wealth Real Estate – including a free bonus year – at more than 66% off what it would normally cost. And to make sure you're completely satisfied with our work, we also want to offer an extra-long 90-day, 100% satisfaction guarantee. You can get all the details right here.

New 52-week highs (as of 3/18/21): American Financial (AFG), AutoZone (AZO), Enstar (ESGR), Expeditors International of Washington (EXPD), Hershey (HSY), JPMorgan Chase (JPM), 3M (MMM), and Altria (MO).

In today's mailbag, more discussion about the American Rescue Plan and the future of our economy. What's on your mind? Tell us at feedback@stansberryresearch.com.

"Just who are we rescuing? I finally had enough and retired in October. The Office of Personnel Management took 90 days to finally get my pension payments to me so I took a distribution from an IRA to get by. Now I am not eligible to be 'rescued.'

"The same federal government just took a grand total of two days to get rescue payments in people's hands. Most ironically being dead or in prison does not disqualify you from receiving a payment. What a farce!" – Stansberry Alliance member Trevor R.

"If 'we don't have time to read it' before voting on it doesn't scare you..." – Paid-up subscriber Carl H.

"Unfortunately only way to John E.'s feedback [in Wednesday's Digest] is thru O.P.'s feedback [in Wednesday's Digest]. God help us." – Paid-up subscriber Tom M.

"I read with deep interest what you and your readers and members think and write about under the general topic of economics or material prosperity. In doing so, I'm constantly reminded of my grad school 'debates' with my Harvard educated economics and finance professors.

"I'm a retired (big) business executive. Now, my also retired wife and I are certainly not wealthy, but we are comfortable by most measures of material prosperity. There is probably nothing which threatens our material prosperity more than REAL inflation, which is no more complicated than the continued and abusive devaluation of the dollar, our soon to be extinct form of U.S. currency. Congress and the Federal Reserve in tandem have entirely different agendas than the average American, who is in the survival mode and where prosperity has become a vanishing dream.

"I have two graduate degrees in these applied academic & financial sciences (or arts of confusion) and I'm constantly scratching my head over the misunderstandings of the American consumer, when it comes to governmentally dispersed data and it's self-serving, so-called practical applications.

"Economics can be simply reduced to the natural functions of supply and demand. The past 100+ years of trying to inflate-away debt isn't new, it's been tried before with prior fiat currencies. It's failed every time and the fiat currencies have failed with it. Supply and demand fluctuate naturally, and they should. The heating up and cooling down of economies, teaches us valuable or necessary risk/reward lessons and keeps everything in check. Manipulating either or both of those variables won't work long term. It will only result in exaggerated and more troubling economic corrections.

"Consider this... Every financial news outlet reports each week how we have about 750,000 new unemployment claims, and then each month how we have about 425,000 new jobs created. Then the 'media' frames these and other statistics by how they compare to economist estimates, whose opinions of course have no bearing on anything. So each month, we have roughly 3 million newly unemployed workers compared to 425,000 new jobs being created and filled, yet the unemployment rate mysteriously goes down???

"And then, if you dig deeply into the news, you might learn how much the dollar has dropped (rarely risen) against a basket of other currencies, which is even more startling because every other host currency in those 'baskets' is being devalued in the exact same way that the dollar is. Via their own government printing presses.

"The Federal Reserve Bank of America has one purpose and mission and it's not maximum employment or growth of the GDP. It's the solvency and profitability of the nation's largest banking (and investing) institutions. Toward that end, inflating the stock market serves their agenda rather well. And pumping newly created cash into some or any form of commerce results in an added element of both available propaganda and real inflation. Congress compounds the issue with tax revisions (mostly corporate giveaways), which give the appearance of growth and profitability but that is rarely the actual case. Deficit spending won't be resolved by inflation, it's merely a ticking time bomb toward an inevitable melt down.

"The unique formula the Bureau of Labor Statistics and government economists use to measure inflation is a byproduct of economist diddling, which intentionally not intellectually ignores the ridiculous recent growth in asset prices and M2 entirely, which is what is destroying America for 90+% of our struggling population.

"In my life we've moved almost entirely from a moderately prosperous single head of household-based economy to a dual or even total family earnings household-based economy, which can't keep up with inflation. More production, less prosperity. Hence, the not so mysterious disappearance of the middle class household of consumers which fueled our post war economy in the 1950s and '60s making the U.S. the king of global (macro) relative prosperity vis a vis our outrageous consumption.

"We are in trouble as our politicians with personal agendas try to buy both support and votes with unchecked and reckless stimulus while the Fed governors smile at both our gullibility and their highly inflated bank accounts and investment portfolios. Throw in large handfuls of market manipulation via futures, shorts, hedges and carefully leaked insider trading practices and we have a system that works for 1% of the people at the expense of 99% of the people.

"Welcome to America. Starting all over again makes more sense than battling this armored tank with a teaspoon. I'm not supporting revolution, just reinvention with common sense governance." – Paid-up subscriber John C.

Good investing,

Vic Lederman
Jacksonville, Florida
March 19, 2021

P.S. Circling back to the question of what you'll do with your money when the Melt Down arrives... because it's an important one. Frankly, I can't think of anything more important for Digest readers. Please don't get caught by surprise... If you don't know exactly when you're going to sell your stocks, I urge you to see Steve's iron-clad exit plan right here.