“The elites are not the problem… the people are.”
So said German President Joachim Gauck in a recent interview. He was addressing the disintegration of the European Union following the United Kingdom’s vote to leave the bloc (aka “Brexit”). It may have been the poorest choice of words in European politics since Marie Antoinette said “Let them eat cake!”
The rage Germans exhibited at their president isn’t unique. It’s felt by populist rebellions underway around the globe. And it’s due to a disturbing trend we’ve noted several times in these pages…
In today’s society, we have two sets of laws… one for the elite and another for everyone else.
Over the last months, I’ve alluded to initiatives PBRG has been working on behind the scenes. They all have a singular purpose: to “level the playing field” between modern society’s two tiers.
Today, I’m happy to announce the first of these initiatives is here. We’re leveraging our connections deep inside the global elite—in technology, in finance, in government, natural resources, and more—to provide you investment ideas never meant for “common” ears. It’s concentrated investment research we’ve never been able to share with our audience before.
More on this later in today’s issue… But first, let’s return to the plight of our poor German friends…
Negative rates have come to “Main Strasse”
The first retail German bank has begun charging its “Main Strasse” (Main Street) customers to put their money in the bank…
Bloomberg reports Bavarian bank Raiffeisen Gmund am Tegernsee has decided to pass negative rates on to its largest retail clients. It’s charging those clients -0.4% on their deposits.
Right now, the measure applies to customers with over 100,000 euros ($111,700) in their accounts… but expect that to trickle down to customers with smaller accounts in the months ahead.
If you think negative rates will only happen abroad… think again
John Mauldin at Mauldin Economics points out a disturbing trend in the way the U.S. Federal Reserve has handled the idea of negative interest rates.
He tracked Fed Chair Janet Yellen’s Congressional testimony throughout the first half of 2016. There’s a distinct pattern: Her stance on negative rates has changed over the months:
In February, Yellen had not “fully investigated” the legal issues of negative rates.
In May, Yellen was unwilling to state whether the Fed had legal authority to go negative.
By June, Yellen had no doubt the Fed could legally go negative.
The bottom line: The Fed has laid the groundwork for instituting negative rates in the United States.
They’re also familiar with PBRG’s No. 1 defense mechanism against central-bank manipulations: gold.
Gold is our favorite “chaos hedge.” Central banks can’t conjure gold bullion out of thin air. That acts as the perfect antidote to their printing presses…
We’ve recommended everyone keep 3-5% of their assets in chaos hedges, like gold.
Teeka Tiwari says negative interest rates mean gold takes on a new dimension…
Here’s what PBRG Editor Teeka Tiwari wrote about this “shift” in gold’s investment implications in the August issue of The Palm Beach Letter:
Throughout modern history, cash and cash equivalents (such as bonds) have always paid interest while you hold them.
But that’s no longer true…
Due to low and negative interest rates, it’s now cheaper to hold gold (which pays no interest) than it is to hold cash or bonds (which now charge you interest to hold them). Friends, that has never happened before.
So, what does all this mean?
We’ll see a steady stream of institutional capital flow into gold as banks, brokers, hedge funds, and wealthy family offices start reallocating some of their cash and bond assets to gold.
This inflow will drive incredible demand for gold. And that will cause gold prices to surge.
As Teeka wrote, in 1960, just 5% of global assets were held in gold. Today, just 0.58% of global assets are in gold… an almost 90% decline from 55 years ago.
If just a tiny fraction of capital flows back into gold, the price will surge. Teeka provides some estimates in the table below. It shows the prices gold could reach based on various global allocations.
|Global gold allocations||Estimated price per ounce|
As you can see, just a tiny move of 30 basis points from 0.58% to 0.85% could send gold from about $1,350 per ounce today to $1,949… a nearly 45% gain.
At the end of the issue, Teeka recommended a unique asset that’s leveraged to the price of gold but safer than a conventional gold mining company. If gold reaches $3,000 per ounce… Teeka projects this asset will enjoy a 237% gain.
The bottom line: If you don’t own gold or have exposure to gold-leveraged assets, you will regret it… as the world sinks deeper and deeper into the negative interest rate abyss.
Our confession: On gold and our other favorite investment ideas…
Teeka wanted to recommend another gold-related asset to Palm Beach Letter subscribers.
It’s similar to the unique asset I mentioned above: safer than a conventional gold-stock play… but with astonishing upside potential. (Hint: up to eight times your money.) But there’s a reason we can’t tell everybody about it.
I’ll let Teeka explain…
Every so often, I come across obscure little plays I get extra excited about. These are small stocks that can move up hundreds of percent… But I can’t recommend them for one big reason: They’re tiny.
Delivering a tiny small-cap play to nearly 125,000 readers in The Palm Beach Letter—Palm Beach Research Group’s flagship newsletter—would be like sending a pack of elephants thundering through a mouse hole.
They would run the stock up so fast, no one could make any money.
An exciting new tool in the Palm Beach Research Group tool belt
That’s why we created a brand-new research service called Palm Beach Confidential.
In Palm Beach Confidential, you’re getting the exclusive picks Teeka and PBRG founder Tom Dyson come across in their meetings and discussions with the most “hyper-connected” elites in the world.
These are often small hidden gems with the potential to make you a lot of money. But they may be a bit riskier due to their small size.
Since they’re off the beaten path, it ensures we can get in before the rest of Wall Street wakes up to them. And that’s why Teeka believes this tiny gold recommendation will explode up to 838% from today’s prices.
With Palm Beach Confidential, Main Street now has unprecedented access to research and opportunities long reserved for a privileged few… those from a different investment “caste.” It’s the first part of our promise to “level the playing field”… and we think you’re going to like what you see.
But this service isn’t for everyone.
It’s the newsletter equivalent of a set of razor-sharp surgeon’s scalpels. In skilled hands, it could help radically improve some key aspects of your financial situation. But in the wrong hands, it could spell disaster.
We provide you with all the training and insight we can… but you have to use this information responsibly.
So please, if you know you’re undisciplined, don’t even think of subscribing.
The Palm Beach Letter provides all you need to make safe, strong income in a zero-percent (or negative) world… and market-beating gains. Stick to the fundamentals PBL provides you, and consider “moving up” only when you know you’re ready.