InvestorPlace Media, LLC.
700 Indian Springs Drive
Lancaster, PA 17601
Richard Band
Take everything you know, dear investor,

…and throw it out the window.

Because unless you deal with the startling new realities of 2009, you’ll lose money AGAIN this year.

And you’ll never, not in a lifetime, make it back.

SHOCK #1 & #2: BEHAVIOR HAS CHANGED AND THAT’S NOT THE HALF OF IT!

Behavior changes decisively about once a decade, representing enormous opportunities for the tuned-in investor.

From fundamental value-hunting to high-tech love affairs, to Honest Abe dividends, to growth at any cost, value shifts are top profit opportunities .

From pay-as-you-go to hyper-leverage, to cash hoarding, I’ve seen them all in the past 30 years and made several lifetimes’ worth of wealth for my subscribers and me as a result. And at each turn, especially when the behavior shift is most extreme, buckets of profit await you.

We Are at Such a Turning Point Now

The proof is all around you: From banks that don’t lend to a Christmas that didn’t even exist on the retail level. Layaway plans? Did you ever imagine you’d see those again?

But that’s not the half of it. If behavior can shift once a decade, values only shift once a generation, at most. When values shift, entire sectors sink or soar with head-spinning speed, and the profit you can scoop up on the turns are reservoir-sized.

The values of conspicuous consumption that have been with us for 20 years are being replaced today with values of sustainability, self-reliance and environmental stewardship. Global adventures—out. Coming home—in. Consider: In Abu Dhabi, epicenter of conspicuous consumption, jewelry sales have basically stopped.

People who have it are selling it—whatever it is.

Money in checking accounts rose 17% (annualized) in the last 2 months. This is no fear-driven flinch. There is a fundamental revulsion against the Madoff Paradigm of the last generation. A disgust with the Humvee Hoax, a wholesale junking of the Happiness Machine.

» ACTION TO TAKE: Small companies will handle behavioral changes best: they’ll trim and tuck and be back out with lower-priced products quickly. I’ll tell you about some of these in a minute. But a shift in values is often led by franchises.

For example, Detroit gave us fins and a V8 engine, expressing all we wanted to be in the ‘60s and ‘70s. They have slumbered since and earned our wrath for not keeping in step with changing values.

Nestle, Pacific Gas & Electric, Walgreens and Pepsi are 4 examples of franchises that are winning our loyalty now by expressing our new values.

» MORE DETAILS: Follow my Simple Profit Systemfor the Obama Era. This proven System offers you protection and profits for a market that has changed at a behavioral and basic values level.

My new report, Simple Profit System for the Obama Era is your key to success in the coming year… even if you’ve lost a good deal of money in the past year.


Get it here.

SHOCK #3: OBAMA’S REAL AGENDA—MISUNDERSTOOD

The mistake you must fix as quickly as possible is a misconception about President-Elect Obama’s true agenda. Fix this before Inauguration Day or you’ll be blindsided—and lose out on a huge opportunity.

Barack Obama has shown his hand, but the market hasn’t seen it.

Look at the team: Tim Geithner at Treasury, Larry Summers as White House economics tsar, Christina Romer leading the Council of Economic Advisors, Peter Orszag running the budget office and now Nancy Killefer as efficiency cop.

All could have served under President Reagan.

Or Ford. Or George H.W. Bush for that matter.

They are on-the-record pro-free traders. They are pro-strong dollar.

They are anti-taxes. They are spending hawks.

Add in sound money advocate Paul Volcker, and you could be forgiven for thinking Reagan were alive!

This is not of course, what the Democrats in Congress want. It is not how Obama won, come to that.

But what we now know for sure is this:

As President, Obama will govern as Reagan, and here is why:

He understands that his Job #1 is to get re-elected!

Once You Understand This
You’ll Know How to Get Greedy!

Expect rallies of 30% in as many days to rock the markets—to be followed by market plunges that happen even faster.

Yet from such manic activity, the Dow will have neither advanced nor declined significantly a year from today!

» ACTION TO TAKE: President Obama got elected on the promise of change, but he’ll get re-elected and create a legacy by delivering stability. His global stability agenda begins with Afghanistan, and Lockheed Martin is central to that.

Boeing’s military and space programs are also key.

On the domestic front, the delivery stability depends upon a few strategic banks and insurance companies playing nice. For example: Insurance underwriter Markel is the Berkshire Hathaway of 2009.

» MORE DETAILS: Obama’s delivery of stability will send the shares of companies key to this agenda soaring. Follow the instructions I give you in my Simple Profit System for the Obama Era and make hay in 2009.


The core of my Simple Profit System is this: You can slam out profits day after day during rallies… you are always out of the way of the slumps… and you never, ever have to wait for a bull market.

And that’s a good thing because…

…SHOCK #4: YOU MAY HAVE TO WAIT ANOTHER 7 YEARS FOR A BULL MARKET!

This brings me to Shock #4. This could cost you even more dearly than misunderstanding Obama’s agenda and the shift in behavior and values in the market. This shock involves the very way you buy stocks.

Here’s a little history lesson you might find valuable:

Huge rallies occur with surprising frequency and predictability during bear markets.

Did you know that?

And my Simple Profit System has been designed to turn these rallies into fabulous profit bonanzas for you.

You must buy stocks that are cash-rich throwaways. And you must sell them as they rocket up in months—or even weeks.

But you must never marry them!

» ACTION TO TAKE: Catch Those Rallies. During the Crash and Great Depression of 1929 – 1932, the Dow lost 89% of its value. Yet you could have made:

18% profit in October 1929
48% profit in April 1930
23% profit in December 1930
27% profit in June 1931
35% profit in October 1931 and
25% profit in early 1932!



Exactly the same happened when the tech bubble broke in 2000.

In all these cases, the rallies were sharp—lasting weeks rather than months. But if you pay attention, well, a 48% profit in one month is not a bad thing, I’m sure you agree!

In fact, while the Nasdaq fell 39% in 2000, our model portfolio rose 24%. Individual stocks did even better, as Profitable Investing subscribers can attest. Robert Half International rose 114%, United Health Group was up 151%, and the Matthews Pacific Tiger Fund was up 85%.

Yes, you’re probably saying…

“But still…it SEEMS SCARY”


And that’s why I created my Simple Profit System. I make it…a SYSTEM. No mystery, no guesswork. It’s a path. All you have to do is put one foot in front of another and follow it!

Do this, and each time there’s a rally, you’re there scooping up the profits.

It’s so simple it’s almost automatic.

Best of all, my Simple Profit System for the Obama Era is FREE.


Here’s a Taste of My
Simple Profit System

This is a SYSTEM—simple to follow, easy to use, no guesswork, ever, no worries about 770-point down days, PLUS you get killer profits from every rally and no waiting for the return of a bull.

Quick: What do the following 6 stocks have in common?

Family Dollar
Big Lots
General Mills
Anheuser Busch
Wal-Mart
Campbell Soup
Yes, they are all consumer staples. They make a buck go further.

But also?

They are up the most of all stocks in 2008. They’ve beaten all other S&P 500 stocks—and risen by as much as 36% in 2008.

Oh yes, and most of them have been on Profitable Investing’s buy list all year, too.


That’s my Simple Profit System at work for you!
WHY defense stocks should do WELL under Obama. A big surprise here, and an opportunity to pick incredible defense bargains at fire-sale prices.


WHICH cash-rich throwaway stocks are ready to lead a sharp POST-INAUGURATION rally.


WHY you should SELL GOLD now! Even better, cash in on gold’s drop under Obama with this DOUBLE-SHORT gold stock!


THE NEW WEIGHTING of fixed income to stocks for your portfolio. Almost certainly, you are overexposed.


THE CASE FOR…IBM! Lowest P/E since 1996, little debt, profits up 22%. Back up the truck!


WHY 8% YIELDS in these AA-rated bonds should be your first purchase for the Obama Era.


TIPS (Treasury Inflation-Protected Securities) were dumb. Now they’re smart—and they beat money market funds by a mile! Details in your report.


SELL THESE 9 MISMANAGED mutual funds—today!


EXACTLY WHEN to buy into rallies. No-Guesswork System for snagging the big “up” days, sidestepping the potholes.


3 BANKS YOU’LL BE GLAD you bought today. Yep, banks.


BUCKING THE TREND—look who’s RAISING dividends. And here’s a surprise: Those companies who’ve kept or raised their dividends are paying out over 4% right now!


And that’s just a small taste.
SHOCK #5: THE BIGGEST SURPRISE

2009 will be the best year in the last 10 for your portfolio. The U.S. stock market is about to deliver its worst decade of performance ever—actually leaving investors poorer for the first time. Proof, I think you’ll agree, that we are in unchartered waters.

Nevertheless, if you adapt to the new realities, you stand to make more money in the next 10 MONTHS than you did in the past 10 years.

You will win, not because President Obama will usher in an era of growth, dazzling leadership, vision and reform.

You will win, not because Wall Street will settle down and get back to…going up.

No. You will win because my Simple Profit System makes it almost IMPOSSIBLE for you to lose!

You will win by BUYING THE RALLIES, exactly as described in your Simple Profit System for the Obama Era.

Begin here.

Let My Experience
Guide You

I’ve been at this since President Nixon took us off the gold standard. I know all about government meddling.

My Simple Profit System makes your profits inevitable, and here’s the thing: My System works no matter what!

But Don’t Believe Me—Please!

Profitable Investing attracts cold-stone rebels because it is written by one. It tells investors about opportunities they don’t ever read in Business Week or The Wall Street Journal.

And Profitable Investing makes the most money in the most difficult times.

So if you think you might give Profitable Investing a try, be skeptical. Put my Simple Profit System to the sniff test.

Does it make sense?

Does it work?

Test drive my Simple Profit System and drive it hard. If it doesn’t hug the curves, ditch it and get your money back.

All of it.

And keep my Simple Profit System for the Obama Era around. I may make a believer out of you one day, even if it isn’t today.
 InvestorPlace Media, LLC.
700 Indian Springs Drive
Lancaster, PA 17601

Richard Band

 


Early Signs of a Credit Thaw





By Elliott H. Gue







In last week’s issue of Pay Me Weekly I outlined my case for expecting a recovery for the broader market averages this year. While some pundits continue to focus on admittedly grim jobs market data, employment data isn’t a good leading indicator for the market; the unemployment rate almost always tops out many months after key market lows.
For example, the US unemployment rate hit 9.0 percent in June of 1975, rising sharply from 7.2 percent at the end of 1974. The S&P 500 bottomed in October of 1974, and the recession ended in March of 1975. If you used employment as an indication of when to buy, you would have missed out on a more than 30 percent rally between October 1974 and June 1975.

I’m convinced this recession will drag on for at least the first half of 2009 and quite likely into the final months of the year. If I’m right, the employment picture may not start to brighten until sometime in 2010, and the unemployment rate could approach the double-digits. But this doesn’t mean the market won’t rally this year.

The Day Lehman Fell Investors Joined “The New World” and profited 17%


That fateful day began the calamity that will define 2008 for generations of investors.

Yet a small group of you joined a visionary service that has handed its subscribers a 17% gain since September 22, 2008.

Roger Conrad invites you to take a look at his new service, The New World.


Although the S&P 500 has given back some of its last-minute 2008 rally, the index continues to trade well above its late-November lows.

This is to be expected, as it’s highly unusual for market recoveries to be V-shaped. Market bottoms are characterized by several re-tests of the low--markets can bounce along the bottom for several months before a real rally kicks off.

One of the most positive fundamental factors to watch is a steady improvement in global credit markets.



Source: Bloomberg

The chart above shows the total dollar amount of all US corporate bonds issued for each month going back to early 2007, before the credit crunch took hold. The chart breaks out the dollar amount of high-yield bonds issued for each month.

The bond markets came to a complete standstill in September. During the months of September, October and November, US companies issued only $110 billion worth of new bonds. The high-yield market was hit even harder. To put these numbers in context, back in early 2007, it wasn’t at all uncommon to see well more than $120 billion in bonds in a single month.

But December and January had seen a nice rebound in corporate bond issuance for the US--credit is becoming far more available. Granted, much of this debt is being issued by financial companies and is guaranteed by the Federal Deposit Insurance Corporation (FDIC); this issuance doesn’t reflect an improvement in the private bond market but is a direct result of government action. The FDIC guarantee program is known as the Temporary Liquidity Guarantee Program and was designed to help unfreeze the lending market for banks.

An example of this is a $255 million bond issuance by Zions Bancorporation (NSDQ: ZION) earlier this week. The bond is rated AAA by all the agencies, their highest available rating, a far higher rating than Zion’s BBB+. Zion’s bonds that aren’t guaranteed by the FDIC currently yield in the 7.5 to 8.0 percent range, 37 basis points above the London Interbank Offered Rate (LIBOR) for the guaranteed bonds. At the time they were sold, the LIBOR rate was 1.14 percent.

But what’s even more notable is that we’re seeing a jump in issuance by non-financial US companies this month. Total bonds issued by non-financials in January is pushing $30 billion, the highest since May 2008.

One of the most active companies in January is retailer Wal-Mart (NYSE: WMT) a AA-rated, investment-grade firm that sold $1 billion total in two different bond issues this month. Wal-Mart is paying more for this debt than before the credit crunch, but there does appear to be a return in appetite for investment-grade corporate debt.

To put the rising cost of debt into context, consider that when Wal-Mart sold bonds in April 2007, those bonds yielded 78 basis points (0.78 percent) above the then-prevailing US Treasury bond rate. The series issued this month, however, yield closer to 200 basis points (2.0 percent) over Treasuries. But it’s undoubtedly a good sign that firms are starting to reenter the market with large blocks of bonds for sale and that those securities are being successfully sold.

In addition to Wal-Mart, oil services outfit Weatherford International (NYSE: WFT) and contract drilling firm Nabors Industries (NYSE: NBR) also managed to sell bonds. Some pundits had feared that with the prices of oil and natural gas so depressed, firms in the energy industry would find it difficult to raise capital. It appears, however, that capital is available, albeit at a higher cost.

Buy Now or Forever Hold Your Peace


Valuations for energy-related stocks are the lowest they’ve been in more than 15 years.

The S&P 500 Energy Index is cheaper today than it was when oil and natural gas were trading at a third of current levels.

One oil and gas E&P is trading so low, two of Europe’s majors are salivating over its prime reserves they can now snap up on the cheap. You get heaps of upside and windfall potential to boot.



Another market to keep an eye on is commercial paper issuance. Commercial paper (CP) is a short-term loan market, with most being issued by firms with high credit quality. The problem in the fall was that the CP market totally fell apart and companies were unable to sell debt. As a result, even some large and well-known firms had trouble with short-term financing and struggled with day-to-day issues such as making payroll.

But government action in the CP market has helped to revitalize issuance over the past few months; check out the chart below for a better look.



Source: Bloomberg

The recession of 2008 looked like a normal contraction up until the fall, when the credit crisis pushed the US economy off the proverbial cliff. Credit and deleveraging have also been perhaps the two most important contributors to the markets 2007-08 bear market and recession.

A gradual normalization of these markets is, therefore, an important change to watch. It will certainly not undo all the damage of the past four months, but it should allow the US economy to stabilize in coming months, albeit at a lower level of activity.

Banks of Opportunity

My longtime friends and colleagues Ben Shepherd and Peter Staas have trolled through the financial sector, examining the balance sheets and deposits of thousands of regional, local and community banks across the US. What they’ve uncovered is truly amazing.

Some smaller banks never got involved in risky mortgage loans and have maintained disciplined reserves. Unlike their larger brethren, many aren’t taking cash from the government’s Troubled Asset Relief Program--not all bankers need a bailout.

Ben and Peter have kindly agreed to summarize their findings and some of their top picks in this beaten-up sector in a free report available to all Pay Me Weekly readers by clicking here. In my view, this report is required reading for all investors.

Speaking Engagements

Redirect the stress built up during this long bear and bask in the Florida sunshine as winter extends into its extra six weeks: Join me and my colleagues Roger Conrad and Gregg Early Feb. 4-7, 2009, for the Orlando Money Show.

I’ll detail PF’s new direction and discuss my approach to stock selection and portfolio management. Roger, a steady hand through many market events such as the one we’re dealing with now, will talk about his new service focused on exploiting the greatest spending boom in history, New World 3.0. Gregg will be there to talk about the Smart Grid, an endeavor he’s exploring as part of his role with New World 3.0.

Click here to attend as my guest, or call 800-970-4355 and refer to promotion code 012647.



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