The Upside of Investing in Debt Would you invest in a company that's loaded with debt? The answer seems obvious... no, of course not. But it's not so simple. Longtime readers know that I look for stocks that let you sleep well at night. These are companies that have strong balance sheets, regularly reward shareholders through share buybacks and dividends, and should be around to help you generate wealth for a long time. Of course, investors who are looking for even more safety often turn to bonds. Bondholders, unlike stock investors, have a legal right to be paid by the company. If a company's balance sheet collapses, its share price collapses with it (and any dividend it pays will end). Shareholders have no guarantees... But bondholders have much more safety. A bond's interest payments are legal obligations. So if a company gets in trouble, bondholders stand closer to the head of the line when it comes to the company paying bills and creditors. Even in the event of a bankruptcy liquidation, the proceeds go to the secured creditors and bondholders. Shareholders get squat. Not only that, but the capital-gain potential of bonds is widely underrated. After a bond is issued, the market will decide its worth. If the company runs into trouble, investors can become worried about a default and a bond can fall to well below its "face value" – the money the company owes bondholders when the bond matures. When you purchase corporate bonds at a discount and hold to maturity, you receive the full face value when the bond principal is paid off. That can be an incredible, overlooked, built-in capital gain... regardless of what the market or an individual company's stock has done. And if investors change their minds about the company's fortunes, the bond's price recovers, and you can take profits without having to wait. One of the best times to apply this strategy is during a credit crisis. And, according to my colleague Mike DiBiase, the next crisis is already here. Mike says a recession could hit as soon as next month. Mike's strategy of buying what's called "distressed debt" might sound crazy to some investors. But purchased at the right price, debt can make a fortune for investors. Don't take our word for it... A longtime subscriber is sharing how this technique helped him solve his financial problems. He was able to retire at 52... send his four kids to elite colleges and graduate schools... and even help buy his elderly parents a beautiful retirement condo overlooking the Atlantic Ocean in South Florida... To hear his incredible story, click here. Here's to our health, wealth, and a great retirement, Dr. David Eifrig and the Health & Wealth Bulletin Research Team
February 8, 2025 | Recommended Link: | | Subscriber Tells All For 20 years, we have never let a subscriber "take the wheel" before. But through a strange series of events, subscriber Rob L. ended up in Baltimore – talking directly to nearly 1 million-plus Stansberry Research readers. See how he did it right here. | |
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Reader question of the week... Q: Hey Doc, any tips for getting sleep when I'm sick? My whole family has had the flu and it feels so much worse at night making it tough to sleep. – G.C. A: Thanks for your question, G.C. The reason you often feel sickest at night is because of your hormones... Your body has an internal clock that regulates the production and release of certain hormones throughout a 24-hour period. It's known as the circadian rhythm, and it synchronizes your body with the cycles of light and darkness in the environment. During the day, your body produces varying amounts of the "stress hormone" cortisol, which helps your body perform a number of functions... like converting fats, proteins, and carbohydrates into energy... and suppressing your immune system while you're tackling the day. Typically, cortisol levels are highest in the morning, fall gradually as the day goes on, and are very low by bedtime. That's when levels of your "sleep hormone" melatonin rise. Melatonin allows your immune system to get to work on detecting infections in your body and releasing white blood cells to fight against them. So if you're sick, this hormone is the reason you start feeling all the symptoms... like fever, congestion, and chills, for example. When you know what's coming at night, you can prepare. I recommend the following to reduce the discomfort of these nightly symptoms... Get at least 1,000 milligrams of vitamin C every day during stretches of cold weather. This vitamin dosage will help with things like boosting your immune system's ability to kill bacteria and destroying infected or damaged cells. And while longtime subscribers know that most dietary supplements are useless or dangerous, tablets and powders are a legitimate, convenient source of vitamin C. Use a neti pot and take a steamy shower at night so that you'll go to bed with less congestion. Break up congestion even further by sipping some hot tea or soup. (If you use a neti pot, follow the instructions carefully and only use sterilized or distilled water.) Adjust your sleeping position to reduce the pressure in your head from accumulating congestion. We hope you and your family can use these tips to feel better soon. Keep sending your questions, comments, and suggestions our way. We read every e-mail... [email protected]. | Recommended Link: | | Elon Musk's Social Security Shock? New research reveals what Elon Musk could be planning in Washington, D.C. and how it may impact your money. In short, Musk has much bigger plans than simply "draining the swamp." His next big project could bring about nothing short of a revolution in our economy – it could change the way you file and pay your taxes... collect Social Security... and how you travel. To do it, Musk will likely use the same strategy he has applied in every other business. See the playbook here. | |
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