By Richard J. Maybury
From Resource Consultants Newsletter. Reprinted by permission.
Each year we like to interview our good friend Richard Maybury, editor of, The Early Warning Report for Investors. We hope you enjoy the interview and take some action on his ideas.
Patrick C. Gorman
Coming: A New Golden Age
An interview with Richard Maybury
Pat: Hello Richard, good to have you back. You've been writing a lot about a coming spectacular boom in precious metals and collector coins, or numismatics - one that will dwarf anything we've ever seen before - and we've asked you here to give us your reasons.
Richard Maybury: Thanks Pat, it's good to be here again.
Pat: Your reasons are unusual, they're mostly geopolitical and military rather than the economic ones we usually hear. I thought a good way to put your insights on display is to do something no interviewer has done before, which is to briefly trace your track record on this war, and wartime investing, from your first work on it in 1981.
Richard Maybury: Good idea.
Pat: As far as I know, no one in the world has been as right as you have about this war, and about how to profit from investments that can do well under wartime stresses. Your subscribers have earned a lot of money.
Richard Maybury: Thanks Pat. Many of the people earning these profits have been your readers, because for more than 15 years you've done a great job of helping me spread the word. By the way, can I offer a note of clarification before we get further into the subject of war?
Richard Maybury: The country and the government are not the same thing. I love this country and would not want to live anywhere else, but I consider the government to be the country's most dangerous enemy. Washington is taxing us to death, it's throwing the best medical system in the world into boundless confusion, it's interfering in absolutely every aspect of our lives, its foreign policy for more than a century has been to wander the globe poking sharp sticks at rattlesnakes, and it's packed with crooks and liars.
Pat: (Laughing) Well, I can see where you get your reputation for being subtle. Let's get started. Correct me if I'm wrong, wasn't it during the 1979 Iranian Hostage Crisis that Iranians rose up against Washington's pet tyrant, the Shah of Iran, who was terrorizing them?
Richard Maybury: Yes. Washington had put the dictator in power and backed him for 25 years, because he claimed to be pro-American.
Pat: Then in 1980, shortly after the killing of Egypt's Anwar Sadat - also backed by Washington - you wrote a 22-page special report called The Thousand Year War. In an effort to avert the disaster we're in today, more than a half-million copies of that report were distributed. You said that if Washington did not stop meddling in Islamic homelands, and backing Mideast tyrants, America would end up in a world war with Muslims.
Richard Maybury: That wasn't 1980, it was 1981.
Pat: Then in 1985, you did a huge article for The Washington Times. You compared today's shoulder-launched guided missiles to the invention of the American rifle in the 1700s. I'm not a weapons expert, could you explain?
Richard Maybury: My 1985 article was called "Patrick Henry Updated, with Missiles ." You can Google it. I pointed out that a key factor that enabled the Minutemen and other rebels to win the American Revolution of 1776 was the Pennsylvania flintlock rifle. The gun was far superior to the government's Brown Bess musket. It enabled Americans to use what were regarded as despicable, cowardly tactics, such as hiding behind rocks and trees to fire from long distances. The Americans won. These rag-tag bands of Yankee rebels beat their government's army, which was the mightiest, most experienced army of its day.
Pat: I remember, it was amazing. When the government's army surrendered to the American rebels at Yorktown in 1781, the redcoat band played "The World Turned Upside Down." And today's guided missiles?
Richard Maybury: In that 1985 article, I said the shoulder-launched guided missile would enable Muslims to do the same thing, to successfully rebel against the Soviet and US governments, who were backing the tyrants who were terrorizing Muslims.
Pat: These tyrants today would be...
Richard Maybury: Musharraf in Pakistan, Mubarak in Egypt and the Saudi royal family are probably the top three most feared and hated, and there are dozens of lesser thugs all over the Islamic world receiving US foreign aid.
Pat: I've noticed Congressman Ron Paul, who leans very conservative, in his presidential campaign is trying to draw attention to this. So you agree, foreign aid is the main culprit, the primary cause of the war?
Richard Maybury: Absolutely. Every conservative I've ever met has hated foreign aid, they've always said it would lead to catastrophe. Rarely in history has anyone been so spectacularly right as those conservatives have. Most of the foreign aid goes not to the people of these countries, but to the corrupt governments that brutalize them, so the people hate Washington.
Pat: Surely you aren't suggesting the US government is a pack of thieves and liars who are in bed with other thieves and liars around the world?
Richard Maybury: I know, I know, it comes as a shock - to those who were born yesterday - but there it is, the federal government is as crooked as a dog's hind leg.
Pat: As the teenagers say, wow, who'd a thunk it? Some Americans seem to believe their foreign aid tax dollars go for humanitarian purposes.
Richard Maybury: Some money does, enough to camouflage the military aid to dictators. And, of course, US officials know that much of the humanitarian aid is siphoned off into the dictators' own secret bank accounts. In other words, much of the so-called humanitarian aid is really disguised bribes.
Pat: I've read that, in terms of today's dollars, since World War II, the federal government has given away more than a trillion dollars of our tax money.
Richard Maybury: That's correct. If we assume an average American family has four people, then that money could have bought good middle-class houses for 18 million Americans.
Pat: In the November 2003 issue of your newsletter, Early Warning Report, you ran a map showing the governments that receive US tax dollars. It's as if, every tyrant on the planet is dipping into the US taxpayer's wallet.
Richard Maybury: Not every one, but certainly most. What's really fascinating is that the State Department is required by law to report what it knows about the brutality of the regimes to which Congress sends money and weapons. You can find these reports at www.state.gov/g/drl/rls/hrrpt/2006/, and a list of governments that receive your foreign aid tax dollars at http://www.census.gov/compendia/statab/cats/foreign_commerce_aid.html. The top ten recipients of foreign aid are the governments of Israel, Egypt, India, Vietnam, Pakistan, South Korea, Indonesia, Turkey, Brazil and Russia. Go ahead and look them up on the State Department site, I dare you.
Pat: I get the point. I remember in an Early Warning Report article you said, foreign aid is why millions of innocent people around the world see every bullet fired at them as made in the USA. Millions still like America, and Americans, but the only foreigners left who like the federal government are the rulers who get money from it.
Richard Maybury: Yes. Much of the aid to tyrants is secret, but in 2002, a Navy officer in the Pentagon spilled the beans, saying that virtually every government except those of Cuba and the ones on the terrorist list receive weapons or some other kind of military aid from Washington. It was in the New York Times, August 10, 2002.
Pat: So, Richard Maybury is part of the blame America crowd?
Richard Maybury: No! I'm part of the blame the federal government crowd.
Pat: I'm looking over the list of the top ten recipients. No kidding, Washington sends our tax dollars to the Kremlin? The Kremlin!?
Richard Maybury: Yes, that very same group of Ruski thugs who are swimming in oil profits, calling us Nazis, and standing ready to nuke us, are receiving our foreign aid tax money. As I said, crooked as a dog's hind leg.
Pat: Continuing with your track record, in February 1989, just as you predicted, shoulder launched guided missiles enabled the Afghans to throw the Soviet army out of Afghanistan. The second mightiest army ever seen on earth was beaten. And nine months later, after the Soviet Union's oppressed masses realized that the Kremlin had become a paper tiger, the Berlin Wall came down, and the Kremlin's empire was shattered. Your 1985 article was exactly right.
Richard Maybury: Yes, unfortunately.
Pat: With the Kremlin's empire collapsing, the world began to cheer a new era of peace and brotherly love. But you said, don't believe it, investors should prepare for a new era of war, plus big profits from investments that do well in wartime.
Richard Maybury: Everybody thought I was crazy. My closest friends, my wife, even I thought I was crazy. But that's what the evidence pointed to, so that's what I wrote.
Pat: (Smiling) I remember, it was in the spring of 1990 that they began measuring you for a straight jacket. Let's see, looking at my computer screen, all those who took your advice then, and bought, say, arms maker General Dynamics, today have a 1,600% profit, compared to about 350% in the S&P 500. In ammunition maker Alliant Techsystems, they have 2,600%. Armor maker Ceradyne, 5,000%.
Richard Maybury: Defense stocks were in a nice uptrend throughout the 1990s. By the year 2000, more than 100 new wars had broken out, killing more than five million.
Pat: And the mainstream financial news media missed that entire trend. What happened to the new era of peace and brotherly love?
Richard Maybury: As I explained in the early '90s, the nations of East Europe, Asia and North Africa are not real countries. They are collections of tribes, clans and ethnic groups, thousands of them, that have hated and fought each other for centuries. The Kremlin sat on that huge powder keg - I call it Chaostan, the land of chaos - like a lid on a pressure cooker, and when the lid blew off in 1989, the explosion began.
Pat: By 2000, you were saying in almost every issue of Early Warning Report, look out. The Muslim rebels have beaten the world's number two military power, and now they are going to come after number one, if Washington does not get out of the Mideast and stop backing Mideast tyrants.
Richard Maybury: Yes. But by then, I wasn't the only one saying it. In a debate at Wake Forest University, October 11, 2000, Bush Junior said we'd better start leaving those countries alone. But by then it was too late.
Pat: Chaostan, that's pronounced Chaos-tan, you coined the term in 1992?
Richard Maybury: Yes. All over Chaostan - not everywhere, certainly, but commonly - if you ask people, do you want freedom?, they will say, Yes!, we want the freedom to kill the people in the neighboring village before they can kill us. That third of the world has been this way for centuries.
Pat: And it's why people such as Saddam Hussein are loved and respected at the same time they are hated.
Richard Maybury: These cutthroats maintain a kind of peace and security, by saying to their people, if you make trouble you die. For Washington to eliminate a Saddam Hussein without causing the kind of bloody chaos we see in Iraq, it must itself become the replacement for the dictator it removes.
Pat: It must become a Saddam Hussein clone.
Richard Maybury: Yes. And that's what it's doing. The Patriot Act, the secret torture prisons, the indefinite imprisonments without trials, the paranoid, fascist airport security checks - these are Washington becoming the evil it's fighting.
Pat: I have your March 2000 issue of Early Warning Report in front of me. It says, look out for 2001, and it advises us to get into investments that do well in wartime, including gold and silver.
Richard Maybury: Throughout the 1990s - that so-called new era of peace - Washington gradually dismantled the US armed forces. I wrote often that when the disarmament ended, meaning when Washington was at its weakest, its Mideast enemies would strike. Bush ran for election on the promise to reverse the disarmament, so it didn't take a rocket scientist to see that his first year in office would be when the Muslim rebels would strike.
Pat: And they did, on 9-11. People who say no one saw it coming don't know what they are talking about. By 2000, you were recommending gold, silver, oil, real estate, guns, armor, copper, platinum, helicopters, natural gas, Swiss francs, C-130 cargo planes - the list goes on and on, all things that do well in wartime, and today your subscribers are, to put it mildly, very happy campers.
Richard Maybury: Yes.
Pat: Jim Powell of Global Changes and Opportunities Report recently did an analysis of your track record, and the results were amazing.
Richard Maybury: Well, I don't know if the results amazed other people, but they certainly did me. As Yogi Berra said, "Prediction is very hard, especially when it's about the future."
Pat: Let me read what Jim said. His exact words were: "I did a little arithmetic on your more speculative portfolio, and found the average gain for your winners is 330.6% vs. an average loss of 25.9% for your decliners. Your overall gain for the 56 EWR issues since the beginning of the war is 241.5%. Those are excellent numbers. Very few investment advisors can match your performance record - and it doesn't even go back to your original recommendations made 10 to 15 years ago."
Richard Maybury: Not to throw a wet blanket on it, but I try to be mindful of risk, and I think we need to say that investments which require peace to do well are getting riskier by the day. The war is clearly spreading, and growing worse.
Pat: Investments that require peace. An example?
Richard Maybury: Bank CDs - ones that are out two years or more are - and I'm not exaggerating - more dangerous than putting your money in slot machines, because big wars produce big inflations. You loan the bank dollars that are each worth one loaf of bread, and years later get back dollars each worth one slice.
Pat: So, what you are saying is, the war isn't going to end any time soon, nor will its effects on the economy and investment markets.
Richard Maybury: Correct. America is going through a very rough patch. This is typical during the dissolution of an empire. The politicians and their henchmen fight like tigers to preserve their power, so the war drags on and on. It won't end soon, but there's a very bright side.
Pat: What do you regard as soon?
Richard Maybury: I'm 99% confident the war has at least two decades left to run, and its effects on the economy and investment markets will grow. I think investments that do well in wartime are as close to a sure thing as anyone has ever seen. Those include gold and silver.
Pat: Two decades?
Richard Maybury: After World War II, the French Empire took about 17 years of bloodshed to wane, and the British Empire about 25 years. Today's US Empire is far larger than either of them, and the war is only six years old.
Pat: You mentioned a bright side?
Richard Maybury: Very bright. Look at Russia. It's no Eden, but it's vastly better than during the days of the Soviet Empire. That's typical throughout modern history. An empire - the domination of other countries - is full of power and glory for the politicians, they love visiting these foreign countries and being treated like royalty by the thugs they're subsidizing. Nothing puffs up a congressman's ego like having his boots licked. But for America as a whole, the empire is a parasite, it's consuming our blood and treasure, and when it ends...
Pat: Wait a minute, before we get to the bright side, many would say America does not have an empire.
Richard Maybury: They're right, America doesn't, but the federal government does; the government is not the country.
Pat: Okay, the bright side. What happens when Washington's empire is gone?
Richard Maybury: Politicians will be depressed, but the country will be much better off. Look at Britain, France, Italy, Spain, all of them. They are, without exception, vastly better places than when they had empires. America, too, will be an unimaginably better place, once its empire - its parasite - is dead. I think we have a very good chance of seeing what historians will someday call The Golden Age of America, a time of peace, liberty and abundance.
Pat: But not right away. The problem is...
Richard Maybury: ... the transition period, it's tough. People who have the courage to face the reality, to study it and learn the ways of profiting from it, can become wonderfully prosperous, as many did when the European empires fell. Those who try to ignore it, will be blindsided by one nasty surprise after another. Many will be impoverished, they'll end up being the chauffeurs, butlers, cooks and maids for their more savvy and informed friends.
Pat: What do you think has the best risk vs. reward ratio at this time?
Richard Maybury: The precious metals, no doubt. They've already done quite well, but they're still far from their historic tops, especially in inflation-adjusted terms. Most other wartime investments hit repeated new highs long ago.
Pat: And among the precious metals, what do you like most?
Richard Maybury: For the cautious, conservative dip-a-toe-in-the-water investor, I like the bags of silver dimes, quarters and halves minted before 1965. Silver right now, is around the $13.00 level. I expect to see it return to $50, and won't be surprised at $100.
Pat: And for people who don't mind a bit more risk?
Richard Maybury: Certified numismatics - collector coins - especially gold.
Pat: Why gold numismatics?
Richard Maybury: The precious metals still have not been discovered by the crowd. Oil has. Real estate has, art, antiques, and lots of other things, but not precious metals, they haven't returned to being fashionable yet. When gold breaks through its historic high, around $850, it will generate big news stories. Then I think precious metals will really take off, and numismatics will ride on their coattails. I think numismatics will soar like the dotcoms did in the 1990s, because, compared to all other investments that do well in wartime, the supply is minuscule. For every $10,000 you earn in gold and silver bullion coins, I think you'll earn at least $50,000 in certified numismatics. But...
Pat: But what?
Richard Maybury: I could be wrong. None of this is an exact science.
Pat: Isn't it illegal for an investment advisor to admit that he might be wrong?
Richard Maybury: (Laughing) Maybe so. But if I'm right about the geopolitical and military factors we've been discussing, then I think numismatics will be the next thing to treat us very, very well.
Pat: As long as you sell before the crowd does.
Richard Maybury: Right, don't get greedy. For both buying and selling, it's better to be years too early than a day too late.
Pat: Which is why your newsletter is called Early Warning Report.
Richard Maybury: Yes. I don't believe in exact timing. I believe in patience and self-control. Buy early, and sell early.
Pat: Tying this into the geopolitics and military situation, when you were in the Air Force, your squadron's job was anti-guerrilla warfare?
Richard Maybury: Yes, and I've continued researching it for 40 years. That's why in 1985 I was able to say in the Washington Times look out.
Pat: Tell us more about foreign aid.
Richard Maybury: Since 9-11, Pakistan's dictator Musharraf, for instance, has received $10 billion worth of U.S. cash, high-tech equipment, planes and helicopters. You can imagine what his millions of victims think about us. If you were Pakistani and one of his troops killed a member of your family, what would you do?
Pat: I probably wouldn't like Americans very much.
Richard Maybury: Exactly, and it goes further. Pakistan is mostly Muslim, and a traditional enemy of India, which is mostly Hindu. Imagine what Hindus think of us for giving aid to Pakistan. And India has 900 million Hindus. If just one in 10,000 decides to kill Americans, that's 90,000 new terrorists. A lot of them speak perfect English and could travel around the US quite comfortably.
Pat: This is outrageous! Up to now, the terrorists have been Muslims, but you're saying that it could soon spread to Hindus, too.
Richard Maybury: Sure. If I were a Hindu watching all this US tax money and weapons going to Musharraf, I'd be livid.
Pat: This kind of domino effect from meddling in foreign countries has been going on how long?
Richard Maybury: Constantly since World War II.
Pat: A specific investment forecast?
Richard Maybury: Gold right now is $670, silver $13, and platinum $1,280. Within 18 months, I'm 60% confident we'll see gold at $1,000, silver at $20 and platinum at $1,600. In five years, I'm 95% confident we'll see gold at $2,500, silver at $40 and platinum at $2,500.
Pat: And certified numismatics?
Richard Maybury: In 18 months, I don't know. In five years, I think five times what the bullion coins do.
Pat: Like the dotcoms.
Richard Maybury: Exactly. But plan to sell early, because picking the exact top is a fool's game, you're likely to lose your shirt. And...
Pat: I know, you could be wrong.
Richard Maybury: (Laughing) Of course. I'm not clairvoyant. I've been right so far because I have an edge, but the edge is a long way from infallible.
Pat: Unfortunately, we're out of time. How can our readers find out about this edge and learn to use it for their own investing?
Richard Maybury: Okay, in the November Early Warning Report I'll do an article explaining it.
Pat: Thanks again for taking the time to meet with us.
Richard Maybury: Thank you, Pat, and you are right, everyone should learn all they can about this war. It will continue being the strongest influence on the economy and the investment markets, probably for the rest of our lives. And, it's why I believe numismatics will be the Next Big Thing.
Again, this year we had a great time interviewing Mr. Maybury. We here at Resource Consultants cannot recommend to you strong enough, how important it is to order Early Warning Report Newsletter (EWR). If you have never subscribed to his newsletter, don't pass it by again. If you have and let it lapse, please do yourself and your family a favor and subscribe again. I hear everyone complain they don't hear what is really going on out there. Mr. Maybury's newsletter will not only keep you informed, it could make you rich. I know of dozens of people that it already has. Call him now!
Patrick C. Gorman
Resource Consultants Inc.
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