How to Invest as America Goes to Hell

Andy Snyder|July 9, 2021

We read some scary research last night… It said that trout are becoming addicted to meth.

For fishermen, that might just be good news. The next time we hit the local stream, we won’t have to worry about “matching the hatch” or finding the perfect bait.

Nope. We’ll just head downtown, find a fella with a bit of a lean in his step and a faraway look in his eyes, and tell him to bait up our hook.

The addicted fish will come from all over for a free hit of the good stuff.

But the question readers are surely asking is… how is a fish getting his hands (or is it his fins?) on hardcore drugs?

Simple… When meth addicts use the sewer system, they fill it with the stuff their body couldn’t metabolize. And because our wastewater plants are designed to eradicate biological contaminants only… the meth slips right on through.

It goes right into our nation’s waterways… where the problem is so bad that addicted fish are now congregating near sewage outlets waiting for their next fix.

It’s crazy stuff.

But what in the world does it have to do with making money?

A lot.

Gone to Hell

Several years ago, we introduced a scale for judging the health of not just a nation’s economy… but also the nation itself.

We figured the answers to the questions our scale begs us to ask would tell us a lot about how and where we should invest.

We call it the “Gone to Hell Scale.” (For some reason, the “Bright and Sunny Scale” just didn’t seem right.)

It measures five key aspects of a nation:

• Its education system
• Its rule of law
• The strength of its social safety nets
• Its tax structure
• Its ability to defend itself.

Put together, these ideas create a robust report card for a nation and the potential energy hidden within its economy.

Let’s see where America stands these days.

Education system: Oh boy… Do we dare to look at the health of our schools over the past 12 months? Many schools have reported that as many as 50% of their students were failing at least one class.

That’s up from 5% or so in an average year.

In our home state, things were so bad last year that parents have until the end of next week to officially ask for a “do over” from the state. They have to decide whether they want their children to repeat the grade they were in last year or move up.

That’s never a good sign.

Pandemics aside, America’s school systems are now ranked smack dab in the middle of their global counterparts. Yes, we’ve got some top-notch universities that are the envy of the world… but confidence in our public schools has fallen to record lows in recent years.

And don’t get us started on the horrific mess that is student loans.

As an investor… we wouldn’t want to own a share of our public schools. No way.

Rule of law: Oh boy… Here’s another one that 2020 did not treat too well. We’ve got lawless zones in our cities… a debate about our elections… calls (from within the government) to defund the police… and celebrities – at least those who don’t end up dead – getting out of jail merely because of who they know.

According to the World Justice Project’s Rule of Law Index, the majority of countries around the globe have slipped backward for the last three years in a row (we’ll likely see a fourth as soon as the most recent data is compiled).

As for the United States, we rank 21st out of the 128 countries measured. Compared with 37 countries of similar income levels, we’re way back in 21st place as well… just ahead of Uruguay.

Social safety nets: Finally… a category where Uncle Sam shines. When it comes to giving away free money… few nations do it better these days than the U.S.

You can get a bonus for being unemployed… your business can get a “loan” that doesn’t need to be paid back… and free money is literally showing up in our mailboxes.

What could go wrong?

Let’s ask the meth-addicted trout in our streams.

Tax structure: Do we even need to spell it out? America’s tax code is one of the most complex on the planet. It’s gotten so bad that it makes most citizens – even former presidents – criminals.

What were once considered incentives to open and run a family business or stay on and farm land that’s been handed down for generations are now considered “unfair loopholes” and ways of cheating the government out of the money it deserves.

Compare the nation’s tax policy from a century ago with its tax policy today and you’ll see we haven’t made progress… we’ve sown destruction.

Defense: This is the toughest category to judge because we don’t really know the specifics. To be sure, America has a mighty military that’s backed by true patriots. But the political class has had its way with things over the last generation. Plus, our enemies aren’t playing by the same rules.

It’s quite likely we’re still No. 1, but the gap is closing.

Our enemies might not be able to destroy us, but they sure could put a hurting on our current way of life.

Why It Matters

If you think this way of looking at things has us starting our day off in a bit of a grumpy mood, you’re right.

America is not going in a good direction.

But here’s the deal… what separates the reactive from the proactive, the takers from the makers…

None of these ideas are new.

These things have been trending in the wrong direction for years – if not decades.

And yet… the S&P 500 hit record highs earlier this week, and it’s easier to become a millionaire now than ever before.

By understanding what’s happening, we can invest accordingly.

It gives us a leg up on the competition.

Right now, we know government intervention rules the day. So we’re investing in a way that takes advantage of the good and avoids the bad. For instance, our buyback stocks are taking full advantage of the nation’s tax policy and its stimulus efforts.

Those stocks are treating us very well.

We also know that our economic dominance doesn’t appear likely to continue for another century. So we’re exploring cryptos and expanding our portfolio overseas.

Things have gone to hell. Or at least they’re more hellish than they once were.

We can gripe about it. We should.

But we’d better be investing accordingly too.

History tells us that we don’t want to be on the wrong side of things when all hell breaks loose.