Monday, 2 August 2010

The Gov't Has Declared War on Savers.

Here's How to Fight Back…

By Tom Dyson
Monday, August 2, 2010

The government has declared war on savers…

It wants to stimulate the economy, boost business activity, and lower unemployment. 
When you save money, you don't support this agenda. Your money stays in the bank
earning interest.

To persuade you not to save, the Federal Reserve has set interest rates at zero percent. 
You get no reward for saving money. In addition, the Fed is inflating the money supply, 
which causes asset prices to rise… and erodes your purchasing power.

It's also engineered a big bounce in the stock market. Thanks to this 65% rally, all the best stock-market income investments – pipeline stocks and real-estate investment trusts –
 are now overvalued, dangerous, and offering record-low income yields.

Most people have no idea how troubled the economy and the stock market are right now… 
and they don't understand how critical savings and income will be in the coming years. 
They're carrying on with their everyday lives like nothing's wrong. Instead of saving money 
and preserving what wealth they have left, they're returning to debt and consumption.

They've fallen victim to the government's war, in other words.

I'm rebelling.

I'm going to fight the government's agenda… and I'm going to save my money regardless 
of zero-percent interest rates and an overvalued stock market. To pull this off, I've had to 
come up with several extraordinary income ideas that pay high yields and keep my money safe…

I call this strategy "Black Market Income"…

"Black Market Income" sounds illegal, but it's not. I've simply turned my back on the conventional savings vehicles offered by brokers and bankers. Instead, I've trawled the 
stock market for undiscovered pockets of safe income. And I've looked outside the stock market… and outside the financial system altogether.

Right now, my favorite Black Market Income ideas are…

1)Preferred stocks

Preferred stocks and bonds are the safest investments trading on the stock market. 
That's because they are loans, not ownership rights. I lend my money, and the company 
has a legal responsibility to pay back my loan in full with interest. I don't care about 
growth, profits, revenues, or costs. All that matters is the company can pay me back my
 debt with interest at the agreed time. You can expect 7% dividend yields from safe 
preferred stocks.

Dividend boosters

Buying stock in the world's strongest companies as they raise their dividends every year 
is the most reliable way I know of to build wealth . Buying stock directly from the company
 and avoiding brokers (and their fees) is the best way to set this strategy up. These 
programs are called Direct Investment Plans, or DRIPs for short.

3)Tax lien certificates

Local governments are desperate for money. To speed up the collection of property taxes,
 they issue tax certificates to investors. These certificates pay anywhere from 14% to 24%
 in interest. Tax certificates are backed by property, so they're extremely safe, and your 
local government handles all the administration of the loans. You simply supply the capital 
and collect interest.

My 12% Letter subscribers can read my special report on tax-certificate investing in the 
Black Market Income section of the 12% Letter's website.

4) Mortgage REITs

Mortgage REITs (which we call "virtual banks") buy high-yield mortgage securities with borrowed money. They earn the spread between the interest rates they pay on borrowings
 and the interests rates they earn on their investments. With the Fed keeping rates at zero, mortgage REITs print money… and will continue printing money as long as interest rates remain at zero. Given the weak economy, I expect the Fed to keep interest rates low for 
years to come.

With the government waging war on savers, most Americans will be condemned to a life without savings and income. But with these unusual income investments, you'll be able to 
keep your savings safe and grow them with interest.

Good investing,

Tom

P.S. On my Black Market Income website, I show you exactly how to take advantage of 
these strategies: what forms you need to fill out… how much income you can collect and 
when… and the tradeoffs involved. I recently recorded a video presentation on my Black Market Income ideas. Click here to watch it.