I put my entire life savings into gold two years ago. Not because I thought gold was going to rise…
But because I thought stocks would fall, priced in gold, by more than 80%. And I wanted to buy those 80%-off stocks, whenever that may be.
In late 2018, stocks suddenly got marked down 15% (priced in gold). And I thought, “This is happening now.” So I bet even more on stocks falling…
End of Our Lockdown
Greeting from West Palm Beach! I’m writing to you from Kate’s parents’ house.
The kids have enjoyed spending time with their grandparents. And Kate and I are taking advantage of having our computers. But it’s time to hit the road again…
We’re getting ready to leave on our great American road trip. We don’t know where we’ll go yet, but we definitely want to go to Mount Rushmore, the Badlands, and Yellowstone National Park.
Otherwise, we’ll go wherever the wind blows us…
A Million-Dollar Trade
The last time I got this feeling was in 2011, when I found bitcoin. I was in some internet forum for geeks and someone mentioned it. I looked it up. And the moment I saw what it was, I knew. I just knew.
It cost $6 at the time. There was only one place to buy it – a website in Japan called Mt. Gox. And it was a brute to get a hold of…
I had to open an account with a PayPal-type service to transfer the money. Then, I had to jump through hoops like sending faxes, passport copies, and bank details. The whole thing seemed like a scam.
But I wired $5,000. Which was a lot of money for a guy, with three babies, who was still trying to make it in the world.
Then, I wired another $5,000. And another. Then, bitcoin jumped higher. And I thought, “This is happening.” So I wired another $10,000, which was enough.
I withdrew all my bitcoin – I had 3,330 of them – and transferred them to thumb drives via an internet airlock I set up using Linux, so they couldn’t be intercepted by online thieves.
Next, I made duplicates of the thumb drives, in case they broke, got corrupted, or burned in a fire. I encrypted them. And then, I hid them in two secret locations.
Meanwhile, I’m a big mouth about this sort of thing. I told anyone who’d listen to buy bitcoin. I even started giving them away.
I gave one to anyone who came to my office, including Bill Bonner – I gave him a physical version of bitcoin called Casascius. And I gave them to my friends, Michael Checkan – co-founder of Asset Strategies International – and Swen Lorenz, an investment blogger.
I must have recommended it publicly, although I don’t remember doing so, because Chris Weber – who pens the Chris Weber Education blog – forwarded me a note from one of his readers recently:
I found this post from Tom Dyson on Facebook a few days ago… (I’m not FB “friends” with him, but I do read anything he posts as he pointed out bitcoin when it was like $15 or something crazy cheap…)
“With the Rupee near all-time lows against the dollar, India feels very cheap to us. We’ve been here a week already and we’ve only spent $180.
“Our hotel is $14 a night. Our meals are $3. Tuk Tuk rides are less than a dollar. A big bottle of water is 15 cents and a freshly squeezed juice or smoothie is 50 cents.
“Here we are in Jaisalmer, the city-inside-a-castle in the far northwest of India near the border with Pakistan…”
As an investor, THIS is what I love reading… and it instantly makes me want to drop everything I’m doing, travel to India, and see for myself! On one side of the world (USA), you’ve got a 9% default rate on subprime car loans. And on the other, you’ve apparently got a genuine bargain… so fascinating!
I also went shopping on the darknet, and I sent packages of cannabis lollipops and Rice Krispies Treats to friends all over the world, paid for with bitcoin.
You know what happened next – the price went crazy. My investment turned into $1 million, and I thought, “That’s enough. I’m out.” So I sold all my bitcoin. After taxes, bitcoin volatility, and Mt. Gox’s insolvency, I ended up with about a $500,000 profit… and a lot of pot lollipops.
I should have held on. The bitcoin I had would be worth about $29.5 million today…
Which brings me back to stocks falling in terms of gold. It’s a little different, but I got the same feeling about it as I had with bitcoin.
I put an irresponsibly large investment into it. I told my brothers and my parents to sell their index funds and buy gold. And I started writing about it in these Postcards…
As I write today, the Dow-to-Gold ratio is at 14.2. I’m expecting it to go down to 5 or lower. At that point, I’ll sell my gold and get back into the best dividend-paying stocks.
Remember, our stop loss for the trade is 22.36. That’s where the Dow-to-Gold ratio makes a new 14-year high and invalidates the downtrend.
But until then, I’m holding on to our gold.
– Tom Dyson
Like what you’re reading? Send your thoughts to [email protected].
Kind words for Tom today, as the Dyson family readies for another American road trip…
Reader comment: Tom, I’m a huge fan and have followed you since the Stansberry days. I agree with your thesis that the government’s only way out of its obligations is to inflate them away. I agree that the Federal Reserve will now do anything it can to accommodate this fraud on the American people.
But how do you explain Japan? Japan has been trying to ignite inflation for almost 40 years. (I’m surprised to read that writing is such an effort for you. Your style is so fluid and cogent.)
Reader comment: Tom, I’m continuing to enjoy your Postcards every day. As one of your readers said, I’d be really interested to read what Dusty, Miles, and Penny have to say about your family’s adventures, so here’s a crazy idea: Why don’t you ask Dusty, Miles, and Penny to write one of your postcards?
Each of them could write a paragraph or two. I think it would be fascinating for your readers. You could give them some focus by asking them to write about a very good experience and then a very bad experience. (This is something I do in my writing class at the university where I teach.) Best wishes and good luck to you all.
Reader comment: I read many emails from other services. But I love your personal stories and your investment advice. For the first time ever, I just recently invested a high percentage of my money into gold/silver. I feel good about it also. Thank you for your help. Please keep writing these Postcards as much as you are able to.
Tom’s note: Thank you for your messages! Please keep writing us at [email protected].