HardAssetsInvestor

Mike Norman, anchor, HardAssetsInvestor.com (Norman): Hello everybody, and welcome back to HardAssetsInvestor.com. I’m Mike Norman, your host, here with the second part of my interview with Martin Weiss, author of the “The Ultimate Depression Survival Guide,” a very feisty great interviewee.

All right, in the last discussion we had, you are looking for the situation to become a lot worse. You were very open and honest about that and very up front about that. However, in the book, you talk about and you mention that there are things that people can do now to protect their assets, to protect their wealth. Long term, you do see this, sort of … it can be an opportunity if you approach it right. How so; what do you do?

Martin Weiss, author, “The Ultimate Depression Survival Guide,” (Weiss): Step one is get rid of all your stocks that are vulnerable to a decline, and that’s probably almost all of them, with few exceptions.

Norman: So all stocks?

Weiss: Almost all. There are a few exceptions. Take advantage of the fact that there is a rally in the market, and whenever you see a future rally, do the same. Step No. 2: Get rid of real estate properties, investment properties, before it’s too late. Step three: Take that cash and put it in a safe place. The safest place right now is short-term Treasury securities, even though there’s no interest to earn, and maybe some gold, small allocations of gold.

Norman: Small allocations of gold … what percent, 10%, something like that?

Weiss: Up to 5, 10%. No. 4: There are going to be some assets that you can’t sell, for whatever reason, that you’re stuck with. To protect yourself against declines, and those assets, hedge, using inverse ETFs. In my book, I list over 50 inverse ETFs that you can choose from as well as a very structured, well-planned-out, prudent hedging strategy for the investments that you cannot sell. The more the market goes down, the more those inverse ETFs are going to be worth.

Step No. 5: If you want to take some additional risk, you can use those same inverse ETFs to go for pure profits. Step No. 6: And this is the bigger opportunity - which is for most people, you don’t have to be a speculator - and that is, to wait for the big bottom.

Norman: How do you know - and this is why I’m asking you - because it looked like back in December, or when we hit 6,500 in a panic sell-off on the Dow, that looked like the big bottom. How do you know?

Weiss: In my book, I devote three chapters to the signs and the typical circumstances that surround the big bottom, and that’s the best way to know. You can’t pick a number. If you were to go by 1929, 1932, it would be 1,500 on the Dow. We don’t know; and even if it goes only half that far, you’re still looking at another 40% decline. So you don’t want to base it on a single number, but there are a lot of conditions or signs to look for.