Government bailout undercuts U.S. markets. Take your money overseas

“Congress is close to sending the president a sweeping measure to help homeowners avoid foreclosure. Under the bill, the Federal Housing Administration would provide loan guarantees for people seeking to refinance their mortgages. The Senate may pass the bill as early as Wednesday. President Bush has threatened a veto, but the White House said Tuesday that the door was open to compromise.”
                                                      - NPR (Morning Edition, June 25, 2008)

And back in April, Congress wanted to let states issue bonds for refinancing subprime loans. That bill would allow bankruptcy courts to rewrite mortgage terms.

This situation is really grinding my gears. Big banks made stupid mistakes, and now the Senate and the Federal Reserve are bailing them out with grants and rate cuts. That’s like coddling a toddler who burned his hand on a hot stove.

Where’s the lesson here, folks?

Until U.S. policy and the Fed get their ducks in a row, some U.S. markets are tainted goods, particularly when the Fed’s solution of lowering rates has erased much of the only potential left here in the States. The Dow is back below 12,000, and home prices are down to 2004 levels.

But there is a silver lining. While U.S. markets have been struggling just to keep their heads above water, certain international markets have been thriving. If you want to stay in the game, you have to be proactive and seek out these new areas of investment… in places like Southeast Asia, Latin America and Eastern Europe. Take a look at how some of the countries in these areas have performed over the last two years:

• China up 439%...
• Argentina up 333%...
• Czech Republic up 298%...

And these are just the tip of the iceberg.

In April I spent three weeks in Southeast Asia developing an investment research report on the best opportunities in sectors like finance, infrastructure and resource management. It’s called “The Singapore Profit Play,” and I’ve just made it available to Taipan Trader subscribers.

It’s easier than you think to get a slice of this international pie. Claim your piece here…

Sara Nunnally
Editor, Taipan Trader

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