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The Next Great Economic Superpower
Imagine a country that has everything an investor could hope for: an abundance of natural resources, a strong currency and a low debt-to-GDP ratio that ensures financial stability for decades to come.
At one time not that long ago, this description would have fit the United States. Sadly, most of its natural resources have been depleted, its currency is a shadow of its former self and its national debt now exceeds 100% of its gross domestic product.
That’s not to say that the USA is doomed, but its days of being a global economic superpower are numbered.
The conventional wisdom is that China is waiting in the wings to supplant America as the next great economic superpower, but there’s a huge problem with that theory.
China has a dearth of natural resources relative to the size of its population. Its currency is not trusted by the other developed nations. And its national debt is growing at an alarming rate as it builds out the infrastructure necessary to support a population of more than 1 billion people.
So if China is not the next great economic superpower, then who is?
Not Russia, with a corrupt government that subverts efforts to convert to capitalism. Not Germany, which has become the banker of last resort to its feeble European neighbors. And certainly none of the South American countries that careen from one despotic ruler to the next.
No, there is really only one country that meets this definition on all counts… and it’s Australia.
Yes, you heard me right, the “Land Down Under” is on the verge of becoming the next great economic superpower, and there is still time for investors to catch the first wave of the coming tsunami of new wealth that it will generate.
Sound as a Pound
It starts with the currency. There is no better indicator of an economy’s health than the strength of its money. The story of the Australian dollar says it all. If you parked $100,000 in Australia in October of 2008, four years later you could have repatriated that money for $166,129.
Not invested in a gold stock… or a telecom… or a utility. I’m talking about a 66% return from putting your money in an Australian savings account!
When you have sound money, everything else falls into place. It’s like flying with a tailwind. If the currency is appreciating, you get richer even if your investment stands still.
Discover the Land That Lives Within Its Means
As the U.S. and Europe drive debt to record levels, Australia practices fiscal restraint. Australia’s debt-to-GDP ratio is only about one-third of Germany’s… one-fourth the U.S.’s… and just one-sixth of Greece’s.
This fiscal discipline brings benefits. Australia is growing faster than any other advanced economy and has posted 21 consecutive years of economic growth. While just 51st in population, Australia is now the world’s 12th-largest economy.
While unemployment is rampant worldwide, in Australia the jobless rate is just 5.7%. And thousands of new jobs are being created every month. But that’s not all…
- Australia was the only developed country whose GDP actually grew during the 2008-2009 recession
- Inflation in the Land Down Under is at the incredible low rate of 2.4%
- Energy exports have grown at a 7% annual rate since 1998, and are accelerating
- Most of Australia’s minerals and energy exports will increase in 2013… including liquid natural gas (up 21%), coal (14%), copper (10%) and iron ore (8%).
The Highest Dividends in the World
According to The Wall Street Journal, Australian stocks’ average yield of 4.5% is more than any other major stock market in the world.
That’s because Australian companies reward their shareholders with far more cash than American companies do. The 50 biggest Aussie companies pay out an average of 65% of their profits, for an average yield of 5.2%. By contrast, the average payout ratio of the S&P 500 is 28%, for a paltry yield of 1.9%.
This generosity applies across the board. Take Australia’s banks, which are among the safest in the world. All four major Australian banks made Global Finance’s ranking of the world’s 50 safest banks. Right now, those four banks pay annual dividends of 10.2%… 9.2%… 8.3%… and 7.8%! (Compare that to Bank of America, which pays 0.4%… or Citigroup, which pays 0.1%.)
And remember… those yields are in Aussie terms. So if the Australian dollar appreciates, it lifts the value of your dividends and capital gains even higher.
Open a position in Australian stocks now and you could easily see 50% currency appreciation… plus a 5% yield… plus 50% capital appreciation in the next few years.
But Australia has another advantage, and it’s a real game-changer…
The China Card
Australia is the best-positioned country in the world to supply Asia’s exploding demand for natural resources.
The Lucky Country is blessed with extraordinary resources and close proximity to the world’s largest pool of consumers. Every time China grows… Australia pulls in more profits.
With China adding more electricity each year than the annual consumption of Brazil, and India demanding record levels of energy, Australia is being asked to supply a huge amount of coal and natural gas to its neighbors.
Australia is on the verge of joining the world’s top 5 global energy suppliers. It’s already the world’s largest exporter of coal. It is also sitting on one of the world’s largest untapped supplies of natural gas—what many experts are picking as the future’s #1 energy source.
Chevron, Shell and Exxon are spending billions of dollars developing natural gas in Australia. When their sites come online, Australia’s natural gas exports are going to surge.
Introducing Australian Edge
We’ve been recommending Australian stocks in Investing Daily’s various investing services for more than 20 years. In 2011, we decided to launch a service 100% dedicated to the strongest market we’ve seen in decades.
Australian Edge gives you investment opportunities that you won’t hear about anywhere else. In every issue, you’ll see ways to take advantage of the stability of a developed country… the strength of a hard currency… and a growing economy.
Meanwhile, the more inflation Washington generates with deficit spending, the higher Australia’s resource-backed currency will appreciate versus the dollar. Why watch your nest egg stagnate in U.S. markets that are going nowhere fast? Why not put at least some of your funds in Australia instead… a country whose currency and economy are wisely managed, soundly tested and proven over time.
What Australian Edge Membership Gives You...
- A new issue of Australian Edge delivered digitally every month. Each issue ranges from 40 to 55 pages.
- Article archives, which are great for researching a particular company.
- Weekly website updates from our team of analysts.
- Flash Alerts on sudden market opportunities that can’t wait for the next issue.
- A new message board section—write us with your questions and read responses we’ve written to others. You become part of a larger investing conversation that benefits everyone.
- An Every-Penny Guarantee that gives you a 100% refund in the first three months. Sample three full issues, and if Australian Edge doesn’t exceed your expectations, you’ll have every penny back in a snap. You can still cancel after the first three months for a prorated refund.
- Free special reports—from time to time we publish in-depth investment reports. We recently released one outlining the Asian demand for liquefied natural gas (LNG) that revealed which Australian companies were going to profit the most.
We’ll Give You 90 Days to Try Australian Edge at No Risk
A one-year membership for this suite of investment tools is normally $697, paid up front. However, with this special introductory invitation, you can try Australian Edge for the next three months on a $147 “give-it-a-fair-shot” basis.
As part of your membership, you’ll get an exclusive special report titled “8 Income Wonders from Down Under.” This in-depth profile of eight Aussie high-yielders could easily boost your income by $800+ a month immediately.
If, over the next three months, you’re not satisfied, I want you to ask for a 100% refund—and we will pay it out to you, no questions asked (and the special report is yours to keep).
But if you decide to keep it, we’ll continue billing you on a quarterly basis until you tell us to stop. Even then, if at any time you decide to cancel your subscription, we will refund the unused portion of your payment.
Remember, the risk of trying Australian Edge is… zero.
Phillip A. Ash
CEO and Publisher