Is That Dollar in Your Pocket, Really Worth a Dollar?

Will your money buy anything in a year? In 5 or 10 years?

Our own Tom Harvey has been tracking the value of the dollar in your pocket and reporting on it daily*. Taking the news on the ‘Sub-Prime Meltdown’ and making the impact to your pocketbook clear. Distilling the adventure that is the current economy so we can navigate it to create real prosperity.

How can we safely profit from the big-guy’s failures? He analyzes it all and gives us the secrets the press isn’t talking about.

In last Friday’s post he wrote:

“The Stock Market went up 119 points today because President Bush announced help for some homeowners with good credit and only a little behind in paying their mortgage.

Here are the details behind the speech. The fine print said those lenders have 2,200,000 mortgages out there that are predicted to default and end up in foreclosure. President Bush’s help through the FHA is stated by the FHA to help about 80,000 households. You do the math. The President’s announcement is nothing more than political rhetoric.”

Tonight we are asking Tom to explain even more. To define terms, cut through the rhetoric we hear on the news and in the papers, and just give us the real story. All live for you. And he agreed. Just the real story**.

He will tell us:
What does all this mean to my real estate portfolio?
What does it mean for the savings and investment accounts I have?
In all this ‘market turmoil,’ how can I get the edge to create massive wealth?

Also,
What is inflation? …and what does it mean to your bank account?
…and how can you make big money on it?
…what does it mean for your investments?

What does the international currency market look like?
…and how can you protect your hard-earned assets from erosion?
…and how can you cash-in on the weak dollar?

What about the Gold and Silver Markets?
…what’s the big deal and why these seem to be going up
…how this market can protect your family’s nest egg

Where is all this market talk going and what should we be looking for in the coming months?
…learn what sign-posts to look for in the market to change strategies

Tom will explain it all tonight, Wednesday September 5^th at 6pm Pacific, 9pm Eastern. Click here to get access to this live call and access to the recording. Plus ask questions and personalize the discussion for your own situation!

This is a call we are pleased to offer at a discounted rate to our entire community, men and women, so that every person and every family who wants to protect assets and/or make a bundle, can have the information to do so. But you have to act to get this important information. Please register above.

We look forward to exploring this world together!

All the best as you grow and prosper,

Liz and Christine

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*Right now, the reports Tom has been writing are on EconomyGuy.com

** This is the real story as Tom sees it. Please note that this call (and this email) is for your information and education only. It will help you to understand what you see and hear happening in the media and in the economy and make decisions for yourself about your money. It is not intended in any way to be investment advice. We are not licensed to do that.

Economy Guy . Com launches

We at WomenforWealth.com are excited to announce a new blog run by our lovely husbands, Tom Harvey and Cyrus Uible, have launched a new blog about the world economy. This blog provides easy to understand news and information about the world economy, the fed actions and what it means for all of us.

And it is updated Daily!

check it out at EconomyGuy.com

Issue 2 - Swiss Francs, Anyone? (Or, how is the US dollar doing?)

from Christine Harvey

Judging from the emails in response to yesterday’s issue about the US dollar decline, many of you share our concern – others are starting to keep a keen watch about what’s going on around us.

Just to finish the scenario about my Swiss Franc bond purchase, I did execute the order today through my most favored broker – but the delay cost me some interest points. Had I bought it 3 days ago when I started my enquiries, I would have had 1.18% yield/ interest. Today the yield fell to .8%. That whopping interest rate probably brings tears to your eyes!

Obviously others are starting to flee in that direction assuming that bonds are safer than stocks, driving bond prices up and interest rates down. But as I said yesterday, who really cares about the interest rate when we compare it to returns on real estate and businesses. It’s the capitol preservation I care about.

Several of you wrote today to say how you noticed how little you can buy in London or Frankfurt with your dollars. I remember the first trip to Paris that Tom and I had, when we were able to buy 10 French Francs with one of our US dollars. When the Franc converted to the Euro a few years ago, you could buy only 4.5 Francs with each dollar. For a long time, the US has been blessed with low prices on homes, goods and services. A fax machine that costs $100 here would cost $250 –$300 in/Europe. I know, because I lived there for 23 years. I see us heading in that direction, here in the US.

The sinking of the value of the dollar will be very expensive for Americans. The lifestyle will change dramatically, EVEN IF you don’t want to travel outside this country. I’m NOT saying this for gloom and doom, I only want you to watch what’s really going on. How much money is the Fed printing? That’s the M1. (How will that affect inflation and housing prices and real estate investment, and business? We’re working in un-chartered waters here.) In fact they stopped publishing the M3 last year. HUM, wonder why? Lots to investigate and learn about once you start delving into this. Then the planning starts on how to preserve your hard earned capitol, and how to plan for appreciation.

Speaking of un-chartered waters, our Hard Money Loan Broker said to us today, “anyone under 38 years old has a hard time fathoming the downturn in the market.” That’s natural, because we all process things through our perspective, and our perspective is generally made up of our experiences. So now is the time to open up our eyes to what has been and what could be and stop assuming it will be as it has always been!

On that note, I’ll turn you over to our bond expert, Tom Harvey. Pay particular attention to the amount of money that the governments are injecting right now, and ask yourself “Why is that?”….

Market Summary, by US Bond Guru, Tom Harvey…

After yesterday’s amazing stock market and money market action, today was important in the way the Central Bankers continued to pour money in. The European Central Bank (ECB) after injecting $130B yesterday, added another $84B today.

The US FED after adding $24B yesterday, added another $38B today. And Fed Chairman Bernanke said that he would pump as much money as it takes to solve the illiquidity problem.

Now that’s what I call more inflation.

The more important fact was that yesterday, FOR THE FIRST TIME EVER, the ECB and FED and Japanese Central Bank worked TOGETHER to add liquidity. This has never happened before. Adding funds has been done on a single national basis, but not a global basis. Several other Central Banks joined in yesterday with this Big 3 Triumvirate too. This was a truly global action.

By the way, do you remember that one French bank started all this yesterday? That bank closed 3 funds totaling $3.8B, but the ECB added $130B liquidity. Kind of an overkill?? Well, no. It turns out that there are lots of European banks holding sub-prime mortgage portfolios, and their exposure is MUCH greater than that one French bank. Other European banks have also stopped trading on the sub-prime mortgage funds.

US banks started calling loans in from companies and hedge funds dealing in sub-prime mortgages a few days ago. Banks don’t want to be left holding the bag when this market implodes. These bank demands are what is causing the illiquidity in the market.

Oh, and by the way again, the SEC is auditing the big US banks and financial companies to see (1) how much sub-prime mortgage market exposure each one has, and (2) how each one values its portfolio. Logic 101 says that this means that the SEC DOESN’T KNOW what is going on in this huge sub-prime mortgage market. Hope that makes you feel uncomfortable – because it sure makes me feel uncomfortable.

You can learn more at the EconomyGuy.com blog, where Tom Harvey updates his thoughts on the world Economydaily.

Swiss Francs, Anyone? (Or, how is the US dollar doing?)

from Christine Harvey

HOW IS THE US DOLLAR DOING – AND WHAT CAN YOU DO ABOUT IT?

I spent the better part of two mornings this week working at turning an IRA into a Swiss Franc account. And why would I do that anyway, you might ask? The interest rate on a Swiss Acct is horrendously low, like 1.18% after fees. The Euro has 3 or 4 time better interest – you can get a whopping 4.2% interest.

But let’s stop the focus on this interest nonsense. Who cares about 2 or 3 % interest difference when we can make huge returns on real estate investments, and businesses.

Why am I looking at Swiss Francs anyway? The answer is simple.

I’m REALLY concerned about the US dollar. The Chinese are threatening to undermine it, the French stopped trading in 3 funds today because of their concern over the US mortgage market, and on and on. Just look around you. We have a war to pay for, and the way the government usually does that is to print money. With more money in circulation, your dollars are worth less and less.

When I called the brokers this week to move into Swiss Francs, they all tried to talk me into other currencies – ‘you’ll get higher interest’ they said. But my objective was not interest, it was the preservation of my capital.

And why Swiss and why not Euros, you might ask? Well actually Euros are my close second choice. It’s a gamble. But I look at it this way. The old money believes in Switzerland and Swiss Banks, and the Swiss Franc. If things get really rocky internationally, the old money will go back to the safest haven they can find – the Swiss connection. And I heard recently that the Swiss Franc is still backed by metals. If that’s true, that’s vital when the chips are down.

The Euro on the other hand has the advantage of being in line for the currency of choice, if the dollar is undermined - which could be the most traumatic economic shift of our lifetime. The Euro has big pull due to the European Union and the huge number of countries it represents. I don’t personally have faith in their stability in the long, long haul because of the interdependence they face. If one country falters, the others have to prop it up, and eventually the whole deck of cards could fall. But for the short haul they are doing pretty well. (In fact when I changed money in Rwanda 2 weeks ago, it had to go to Euros first then Rwandan Francs, and the exchange rate between the dollar and the Euro was 1.38. That’s a pretty amazing rise, when you consider it was 1 to one when the Euro was launched a few years ago.)

Well, that’s all from me for the moment, now I’m going to turn you over to our personal US Bond Advisor, Tom Harvey. I don’t know anyone who knows the bond market better than Tom, and by studying the bond market, you have a window into every aspect of the economy. So I’ve asked him to do a summary of activity, and here it is…

Market Summary, by US Bond Guru, Tom Harvey from EconomyGuy.com

Today was one of those days that should be remembered in the future. The DOW went down 387 points due to lack of confidence in the sub-prime mortgage market.

The trigger was the French Bank BNP Paribas stopping trading in 3 funds that invested in US sub-prime mortgage because the market value of the funds could not be determined. The European Community Bank added $130B to bank overnight trading to calm the market, but this had just the opposite effect. (You can tell that these central bankers are working in uncharted waters.) The US Fed added a greater than normal $24B in overnight funds.

Now that’s what I call inflation.

The US Bond market jumped up, and became a haven of security in these turbulent times. (Don’t worry, investors will forget about today around 8AM tomorrow.) The 10 year bond interest rate fell .07%, but this was only half of what it lost the last few days.

The currency market was interesting. The US Dollar strengthened slightly as people thought the US was a haven for security. (This attitude will change sometime in the future when foreigners realize that the US Dollar is not a haven for security, but just the opposite.)

Here’s the closing details:
DJ30 – 13,270 (down 2.83%)
10 year US Treasury Bond – 4.79%
US Dollar - $1.3661/Euro. About 2 cents off the record high.