Whether you lose a lot of money or make a lot of money in the near future will depend on the investments you make now.
Within the next 5 to 10 years, it is very likely that all parts of the world will be hit by a Peak Investment Crisis. I found out that this crisis was likely to happen because my investment strategies aren't based on crunching numbers or figuring out technical patterns. Instead, they are based on finding money trails between the most powerful political, financial, and business institutions in the world. Statistics and numbers are always being changed and are often not what they seem to be. Because of this, a lot of investors who only use fundamental analysis never get rich.
But the trail of money doesn't lie. Depending on how you set up your portfolio right now, you will either build wealth beyond your wildest dreams or have to put off retirement and struggle for the next two decades.
Did you know that right before the Great Depression hit the U.S., the stock market had gone up for about a decade in a row and unemployment was less than 1%? Did you know that right before the Asian Financial Crisis of 1997, which hit the "Tigers" of Southeast Asia (Indonesia, South Korea, and Thailand), the economies of South East Asia were booming with high single-digit to low double-digit growth rates and a flood of foreign investment?
In fact, the outlook for the U.S. economy right before the Great Depression was, at least on the surface, as good as it could have been. But when the tide turned, investors were hit in the face by a 2,000-pound bear and lost their fortunes overnight. And in Thailand, the economy was so good right before 1997 that the general economic excitement led to a real estate boom that is still visible today, more than a decade later.
But even though everyone was happy at the time, when the crisis hit, the Thai currency lost more than half of its value in just six months, and businesses closed all over the place! If you drive through Bangkok, you can easily spot the empty shells of half-built office buildings and high-end homes that are spread out all over the city. When the crisis hit and the money to finish these projects ran out, they had to be scrapped.
In reality, the conditions that led to both of these crises had been building up for years, but the average investor only saw the result: the loud crash that happened when the steam blew the head gasket. Even though most people lost a lot of money in both situations, the smartest investors actually made a lot of money during these times.
And just like other economic crises, this Peak Investment Crisis will give smart investors one of the best chances they will ever have to make a lot of money in the near future. Obviously, a big economic earthquake could happen again, and when many signs below the surface show that this is a very likely outcome, only the most foolish investors wouldn't do anything to prepare for it. In fact, I would say that this Peak Investment Crisis is more dangerous than either of the two financial crises I've already talked about because it's more likely to have a much bigger effect on the global economy.
Why?
Since 1997, hedge funds and other financial derivatives have grown by leaps and bounds, and their combined markets are now worth more than a hundred trillion dollars. During the crisis of 1997, all of these financial instruments were about the size of a baby monkey compared to how big they are now. Due to the rapid growth of financial instruments, asset classes, industries, and global markets are now more connected than ever before. This means that a financial crisis in one region can now have a much bigger domino effect on global markets. So, while a small rock that fell on top of a snowdrift in the past might have caused a local financial disaster that spread to other economies, the same rock can now cause an epic global financial avalanche. And this crisis is almost certain to happen because the rock that is about to fall is not a small stone but a huge boulder.
How to make sure you make a lot of money on the stock market and don't lose it when this crisis hits.
Because of the things this article talks about, over the next 5 to 10 years and beyond, 90% of investors will fall into one of two groups. They will either make a lot of money or lose a lot of it. Because this coming crisis will affect the whole world, there won't be many investors who don't end up either making a lot of money or getting into a lot of trouble financially. How can you make sure you're on the right side of the fence?
The answer is always to take care of your own money. No ifs, no buts, no maybes.
Giving your money to a global investment firm is fine if you already have a lot of money and don't want to make more. However, you are still likely to lose a lot of money when this crisis hits, even if you already have a lot of money. What if this crisis doesn't come to pass? Even though we think this crisis is almost certain to happen because of the way things are right now, if by some miracle the world's governments can stop it, learning how to manage your own money will still give you a great chance of making 20% to 25% or more on your investments every year. And if this crisis happens the way we think it will, your returns during this time should leave annual returns of 20% to 25% in the dust.
