The Government Doesn’t Have Your Back as an Investor

Don’t believe the hype – most of today’s corporate debt will never be repaid…

This story was originally published here.

With just one mistake, Dennis Buchholtz lost a quarter of his life savings…

Today, I want to share Dennis' unfortunate story with you.

That's because many honest and hardworking folks just like Dennis are about to make the exact same mistake again right now. But the good news is, you can avoid it…

For more than 30 years, Dennis worked as a diemaker in the auto industry. He spent countless days and weeks turning sheet metal into fenders, roofs, and hoods.

Finally, in 2005, Dennis retired to spend more time with his wife.

During his career, he managed to save about $400,000, and like everyone, he wanted to find a safe way to earn income in retirement…

After spending decades in the industry, Dennis believed the biggest automakers would always survive. So he put about $100,000 of his savings into a “safe” bond from the largest automaker at the time – General Motors (GM).

Every year, the retired couple received around $7,000 in interest from the bond. They used the income to pay their property taxes and utility bills, as well as for groceries.

At the time, after more than a century in business, GM was one of the most important U.S. industrial companies. On the surface, it seemed like a safe investment to Dennis.

But in reality, it was a highly speculative bet on a company with a massive debt load that it could never repay.

I'm certain that Dennis didn't spend a single minute studying GM's financial statements before making his big bond purchase. If he had, he might've wondered how the company planned to pay back $455 billion in liabilities when it stopped making profits in 2005.

At the time, it was easy for average investors to make mistakes like this…

Stocks were rising, and banks were lending. And that's simply not the kind of deep analysis that most investors do when times are good and credit is flowing.

I'm also certain that Dennis wasn't a Stansberry Research subscriber…

You see, as longtime subscribers might recall, our founder Porter Stansberry first started warning folks about GM's dangerous financial situation in the Stansberry Digest in January 2007.

At the time, no one thought GM would go bankrupt – except Porter.

In February 2007, he warned subscribers that “GM will be bankrupt within three years – or perhaps sooner if the economy slows.” Porter noted that GM's total debt had doubled over the previous 10 years as its market share and profits plummeted. Said another way, for roughly a decade, the company had been burning the family furniture just to keep the furnace running.

Of course, we now know that Porter was exactly right…

GM declared bankruptcy in June 2009, a little more than two years later.

Stockholders were completely wiped out. And investors who owned the $27 billion worth of GM's “safe” unsecured bonds – including Dennis – only got around $0.10 on the dollar of their initial investments. The massive loss wrecked Dennis' grand retirement plans.

If Dennis had read Porter's work, he could've sold his GM bonds and avoided nearly all of his losses. But investors like Dennis believed GM could never go bankrupt. They believed that Uncle Sam would step in and bail them out if they got into trouble.

They were partially right… The Big Three automakers – GM, Ford Motor, and Chrysler – were protected by lawmakers in Washington, D.C. These lawmakers would never let the automakers shut down operations, costing thousands of jobs for everyday Americans.

But here's the important point that most investors missed…

While the government made sure GM survived, it didn't stop the company from going bankrupt first.

 Sadly, inexperienced investors like Dennis make this mistake all the time…

Story continues here.

Legendary Analyst Picks #1 Stock of 2020

Most people will go their whole lives without capturing a 1,000% gain in stocks.

But one man from rural PA may have cracked the code.

11 years ago, millionaire early stage investor Matt McCall shared some of his first recommendations with the public, live on air.

Click here to see legendary analyst's next pick...

The anchors laughed in his face…

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Since then, McCall has built one of the greatest track records in the financial world.

He's pinpointed dozens of stocks that went on to jump 100% or more.

Plus 18 recommendations that skyrocketed over 1,000%.

Today, he's doing it all over again.

McCall just teamed up with one of the biggest names in finance to reveal the name and ticker symbol of what he predicts will be the best-performing stock of 2020.

He says:

“I'm confident that this is my next big winner — and I haven't felt this way since back in 2009. This company is on the cutting-edge of one of the greatest medical breakthroughs of the 21st century. You can't afford to ignore this.”

To see McCall's newest prediction for yourself, simply go here.

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