Today's comment is by Larry Grossman, a long-time member of our Council of Experts, leading expert on retirement plan management, and Managing Director of Sovereign International.

No doubt you've already read numerous financial articles that all began with..."In these difficult times." These days everyone seems to have a different opinion of why the markets are down (including yours truly).

But the fact is this isn't the first time we've experienced severe turmoil in the financial markets, and it won't be last. But it seems the big industry players in the market never learn from their mistakes. Indeed, time and time again, sooner or later, the pain withers, and the greed factor comes back.

We have lived through investment bubbles and calamities for centuries. In the 1800s, it's said that even the British royal family got swept into the investment fad at the time. If you want to go back even further, the Dutch traders had their own famous bubble in 1636 when speculators inflated the price of tulip bulbs.

Yes, the speculative bubbles and crashes may differ over time but one thing remains the same: When all is said and done, everyone wishes they had cashed out just before the bubble began in the first place. But as we all know, only a few fortunate investors manage to get out in time.

But imagine how wonderful it would be to not have a care in the world when the market falls another 300 points. Imagine not even bothering to check your account statement because you already know what it will say no matter what. Wouldn't it be fun to watch CNBC and laugh out loud when you hear the markets just plummeted again? Saying: "Haha - not me! You can't touch me!"

It's all possible...with "capital guaranteed investments."

The Ammunition You Need to Laugh at the Markets

I call them "capital guaranteed investments." But they're also known as principal protected notes, or structured bonds.

These investment products allow you to gain all the advantages of investing in the markets, but your investment capital is fully protected in case the market drops. In other words, you guaranteed to get back your original investment - no matter what.

You may be asking: How does that work?

The concept is actually quite simple. As you know, you usually buy a bond at par i.e. US$1000 per bond. However, you can also buy a bond at a discount, say US$950 and then it matures at US$1000. So what happens to that extra US$50? Your broker could use the extra US$50 to buy you options on a particular index, like the S&P 500. That gives you the participation in the stock market.

Most guaranteed capital investments work that way. These investments are structured so you have exactly the same rewards based on any upside movement. So if the S&P or Dow moves up 30% over two years, then you receive 30%. And if the market crashes or goes nowhere, then you still bought your bond at US$950, so it will mature at full face amount and you walk away with your original principal intact.

The only caveat is you don't make any interest on the bond, because you essentially used your money to buy the stock index.

Super Bonds: Guaranteed Capital and Peace of Mind

Here's the norm: If your stock or retirement portfolio is up 15%, then it can only take a single stock sell-off to make that 15% disappear. Plus, your actual principal vanishes as well. But a simple structured bond can save you from that calamity.

Most investors think of bonds as long-term investments that have to be locked in. But that's not true at all. Let me explain.

Let's say you're in a 3-year bond linked to the Dow. Eight months have gone by and you're now up 12%. With a structured bond, you can promptly sell that 3-year bond and roll the 112% (your initial 100% capital plus 12% return) into another structured bond with a full capital guarantee. This way you lock in your 12% gain no matter if the market goes up, down or sideways.

In fact, you can just sit back laugh because you are now buffered and protected with your 12% gain. Then let's say another six months go by and you're up another 6%, you can roll that again into another 100% capital protected issue, and lock in your 18% gain! Isn't this amazing?

If the worst should happen and the markets drop severely, then you will get back your initial plus 18% as long as you hold the bond to maturity. If you sell it prior to maturity, you will be selling at the prevailing market price, much like a stock.

Better yet, you can invest in such structured bonds linked to a whole variety of markets, like commodities, or international stocks. Investing in oil, cattle, copper, sugar or Brazilian equities can be arduous and complex enough...but you can do it all with structured bonds.

Question: Which market will outperform all others in the next few years? Will it be the stock market, Commodities, foreign currencies, or bonds?

Answer: "Who cares?"

With a capital guaranteed investment, you can get the upside of whichever market performs the best and deliver you those gains plus your initial capital.

LARRY GROSSMAN, CFP®, CIMA®
Managing Director Sovereign International
Palm Harbor Florida
(727) 784-4841
lgrossman2worldwideplanning.com
www.worldwideplanning.com

P.S. Want to know more about how to use PPNs and structured bonds in your private stock or retirement portfolio? Please give us a call at (727) 784-4841 at Sovereign International Asset Management and ask for Shervin Mellegard.

Also, my friend at The Sovereign Society, David Newman has discovered a completely different type of "guaranteed capital investment" (separate from PPNs and structured bonds) - that pays guaranteed dividends. Get the details here.

Fortune 300 Analyst Abandons Stocks in Favor
of "Guaranteed Cash Dividends"

Instead of riding the Dow down the tubes, he's found a way to collect "Guaranteed Cash Dividends" of 10.5%... 21%... even 72% - on America's top companies.

To find out how he did it - without buying a single share of stock - click here.

Strange Bedfellows:
Libertarians, Tax Attorneys and Investment Experts

"Politics makes strange bedfellows," is a phrase I've heard all my life. I've also experienced first hand - not so much in bed, but in unusual political alliances. It accurately describes the fact that political interests can bring people together who have nothing in common.

The saying is adapted from a line in The Tempest, by William Shakespeare: "Misery acquaints a man with strange bedfellows." A shipwrecked man speaks the line when he finds himself seeking shelter beside a sleeping monster.

We at The Sovereign Society, now over a decade old, have been very fortunate with our associates and alliances. Now and then we encounter monsters, sleeping and otherwise, but in addition to our professional management and staff, we have been honored to work with leading experts on offshore investment, currencies, law, banking, business and international citizenship and foreign residence.

Indeed The Sovereign Society's highly qualified Council of Experts includes fully qualified professionals located, not only in tax and asset havens, but in many countries around the world.

Our Council of Experts members share a freedom and liberty loving philosophy, which probably can best be described as "libertarian," in the sense that we are advocates of liberty and free will, especially with regard to freedom of thought or conduct.

Our ever-expanding Global Council of Experts includes experienced lawyers, estate planners, tax consultants, investment analysts, money managers, trust providers and currency traders - all specializing in offshore finance - are at your service. You can take advantage of our offshore asset protection expertise and global investment strategies.

BOB BAUMAN, Legal Counsel

P.S. Join The Sovereign Society today, and you'll instantly receive all our experts' contact details to use for your own finances. Or you can join us at the upcoming Offshore Advantage Academy seminar - and meet them personally.

Treasury: "Could You Spare Another Handout America?"

The United States Treasury could use a handout. They're dealing with sharply lower tax revenues, two military campaigns and a struggling economy. In response, the Treasury spokespeople just announced it will quadruple its borrowing requirements for the quarter ending September 30.

Longer term, the country's funding needs will require substantially higher interest rates. By all accounts, this borrowing is already running out of control. In fact, the borrowing binge is heading for the record books. The United States must raise about US$2.5 billion DAILY to fund its budget gap.

The United States Treasury estimates it will need to borrow US$171 billion for the third quarter - the second highest funding requirement on record. The highest borrowing binge occurred in the January to March period earlier this year when the Treasury raised US$244 billion.

The deficit for this fiscal year, which ends September 30, is projected to hit US$389 billion, up 140% from US$161.5 billion the previous fiscal year. The United States has not logged a budget surplus since 2000.

With borrowing like this, is it any wonder why gold is in a secular bull market this decade? Do yourself a favor: Use any intermittent dollar strength to buy gold.

ERIC ROSEMAN, Investment Director

P.S. My newly updated report tells you exactly how to add to your gold positions as soon as possible. Get your copy here.

What George Bush Was Told Behind Closed Doors…
Could Make You Very Rich

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