Six Shocking Changes …

It was exactly 40 years ago that my father and I founded this company, Weiss Research.

And to mark the occasion, I have just released The Ultimate Money Guide for Bubbles, Busts, Recession, and Depression, a fully updated and expanded edition of my most recent New York Times bestseller.

I’ll tell you a bit about it later. But first, I want to show you the dramatic impact of the changes that have taken place in the four decades we’ve been in business …

A Massive 40-Year Deterioration
In America’s Financial Stability

On the day we founded Weiss Research — an unseasonably warm winter day in February 1971 — Dad and I met at my uncle’s apartment at 200 East 16th Street in Manhattan to scan the horizon for the next 10 years.

We talked about three primary dangers ahead in that decade:

• The likely collapse of thousands of savings & loan associations and banks.

• The possibility of a dollar devaluation.

• And, ultimately, the greatest danger of all — a collapse in the ONE key market that we felt should have NEVER been allowed to collapse: United States Treasury bonds.

All those events came to pass! And today, a similar series of dangers is upon us, albeit with six shocking changes …

Shocking Change #1
Hundreds of Cities and States on the Brink

Back in 1971, only a few cities were financially weak, and it still caused serious pain for hundreds of thousands of Americans.

So if you had predicted that, in the year 2011, hundreds of cities — and even entire states — would be on the brink of financial ruin, Dad and I would have stared at you in disbelief.

Never could we have imagined anything that bad in the United States of America!

And yet, that’s what we have today.

Shocking Change #2
Federal Deficit Near 10 Percent of GDP

In the early 1970s, our nation’s federal deficit was usually less than 2 percent of GDP, and still it was a cause of grave concern.

So if you had said that 40 years later, it would hit 10 percent of GDP — FIVE times worse — we would have been incredulous.

Never could we have imagined that the deficit would be that big in the United States of America.

And yet, here we are with a deficit that’s in that danger zone — not just for one year, but two, three, even four years or MORE.

Shocking Change #3
Social Security Fund in Shambles

Back then, the Social Security Trust Fund was sacrosanct — with healthy surpluses.

Yes, we saw those surpluses diminishing in the future, but still staying in the black as far as the eye could see.

So if you had told us that before I turned 65, the trust fund would be deep in the red and sinking further into the hole for many years, we would have said flatly:

“No!

“Sure, many of our politicians are irresponsible, sometimes even downright stupid. But they’ll never let THAT happen in the United States of America.”

And yet, that’s precisely what’s happening today. The Social Security Fund is $130 billion in the hole — THIS year, with future deficits as far as the eye can see.

Shocking Change #4
2,673 U.S. Banks and Thrifts Weak

Back in 1971, Dad and I felt the nation’s banking problems were mostly in the S&L industry — not the big commercial banks.

So if you had told us that, 40 years hence, over TWO THOUSAND commercial banks — holding MOST of the assets in the U.S. banking system — would be in a weakened condition, we would have said you’re nuts.

Worse, if you had said that the nation’s largest banks — including JP Morgan Chase, Citigroup, and Bank of America — would be using depositors’ money to speculate with over $200 TRILLION in derivatives, our answer would have simply been:

“Never!

“It could never get that bad in the United States of America.”

And yet, that’s precisely what we have today.

Shocking Change #5
Federal Reserve Running Amuck

Back then, the Fed wasn’t exactly the bastion of conservative monetary policy.

Whenever the economy sank, they fought back, of course.

They lowered the discount rate. They eased money. And they even made some “radical” changes, like letting banks compete freely for hot money deposits.

But slamming interest rates down to ZERO!?

Doubling and tripling the monetary base in two years flat!?

Running amuck with the most massive money printing since the Weimar Republic!?

Even in our wildest imagination, we never dreamed that could happen in the United States of America.

And yet, that’s exactly what Ben Bernanke has done — and is pursuing — right now.

Shocking Change #6
Rapidly Running Out of TIME

In February 1971, we had time.

It wasn’t until six months later that Richard Nixon devalued the dollar. And it wasn’t until years later that thousands of S&Ls went bust, inflation surged, and Treasury bonds collapsed.

Today, we do not have the luxury of time. We may have a temporary market lull this week, this month, or even a while longer. But behind the scenes, events are unfolding quickly:

• The established ratings agencies are getting ready to finally downgrade a raft of municipal bonds and their issuers.
• The U.S. dollar is sinking.
• Key commodity prices are soaring.
• And perhaps most ominous of all, the decline in long-term bond prices — along with the rise in long-term interest rates — is accelerating.

Fortunately, however, for me and for you …

There Are Also Some Things That
Have Changed for the Better!

In 1971, the best Dad and I could do was to help investors one at a time.

Weiss Research had no computers and no staff.

When an investor asked us to evaluate the safety of his or her bank, we hopped on the downtown express, walked into the bank’s headquarters on Wall Street, and picked up a copy of its balance sheet — to analyze by hand on my uncle’s kitchen table.

Today, we have Weiss Ratings — the nation’s leading independent rating agency covering over 8,000 banks and 4,200 insurance companies … and acting as the distributor for the ratings we created years ago on tens of thousands of stocks, ETFs, and mutual funds.

Moreover, 40 years ago, you had very few investment alternatives.

Average investors could buy strictly U.S. stocks or bonds. Unless you were a millionaire or unless you were willing to expose yourself to unlimited risk, you had no other choices.

Today, it’s much easier to avoid the threats and even profit from their consequences. With the click of a mouse, you can buy simple investments for protection — and PROFIT — from each of the grave dangers we face.

Case in point: 1,124 exchange-traded funds (ETFs) with $1.02 TRILLION in assets, according to Ron Rowland’s latest tally.

You can escape the traditional world of stocks and bonds. And you can open up some of the greatest profit opportunities of a generation.

Just remember one thing: When you reach for larger profits, you also must accept larger risk. So please stick to the guidelines that Dad and I laid out years ago, and that Weiss Research continues to recommend today …

• Keep a big chunk of your money safe — far away from the grave dangers I have just told you about.
• For assets you have that may be exposed to those dangers, build a wall of protection around them. Protect yourself against municipal defaults, a declining dollar, and rising interest rates.
• Then, once you’ve battened down the hatches, it’s OK to be more aggressive — provided it’s with money you can afford to risk.
• But unless you’re a very experienced investor, avoid UNLIMITED risk investments like short positions or futures.

Plus, in my new book, I show you …

• Why even the shocking trillions in bailouts and guarantees Washington has handed out haven’t been enough to prevent a new debt crisis (page 31) …
• Why Wall Street cheerleaders, top economists, and our leaders have been so wrong at every stage of this crisis — and why listening to them now could cost you up to half your wealth in 2011-2012 (page 38) …
• What REALLY can happen if your bank fails — what the FDIC insurance covers and what it does NOT cover … why many depositors could be very disappointed (Chapter 6) …
• How to find safe insurance companies, the best life insurance policies, and the best annuities. What insurance agents never tell you … policies nobody needs but almost everybody buys … plus much more (Chapters 7, 8, and 9) …
• The ultimate alternative ETFs for reaping wealth in the worst of times. Follow these steps to protect your portfolio and reap far larger gains (Chapter 11) …
• 3 shocking reasons why Wall Street ratings on stocks and bonds are dangerous. Hidden conflicts of interest, bias, payola, cover-ups, and scams that could lure you into deadly investments (page 41) …<
• Your home loses another 20 percent of its value — but THIS investment wipes out your loss or even hands you a profit. The five-step hedging strategy every homeowner should be using now (page 173) …
• 5 easy ways to spot the REAL bottom in stocks and bonds — and use it to pile up massive wealth in a recovery (page 193) …
• How to maximize your bond market and Treasury yields with safety — in six simple steps (page 209) …
• Dividends: Your next great income opportunity. Four easy steps to find stocks with steadily rising dividends (page 217) …
• The best time to buy gold — 700 percent profits possible! Get your timing wrong and you’re likely to lose a bundle. Get it right and Katy, bar the door! How to invest in gold, gold ETFs, and mining shares during a depression (page 229).

I suggest checking out the table of contents — plus the sample pages —available here at Amazon.

If you prefer, you can also find the book at Books-A-Million or Barnes&Noble.com.

Hard copies are available online and in bookstores. And you can download the book instantly for the Kindle and for the Nook.

I believe the book is for a good cause — not only to help investors, but also for our country’s entire future. Plus, my royalties go to charity.

Good luck and God bless!

Martin