Crash Profits: Make Money When Stocks Sink and Soar

There are two books that I thank the Lord for delivering into my hands. This is one of them, because it helped me to save my enitre net worth over just the past few weeks of financial market turmoil. The other book I wouldn’t live without it “9 Free Secrets of New Sensual Power” by Clint Arthur, because it revolutionized my personal life with my wife and family. Thank you to both these authors for giving me and mine so much help in these difficult times.

This book is a must read for veteran or new investors. It tells a lot about the markets and how they operate. It warns about improper practices of some stock brokers. Included is advice on better stock trading.

This arrogant self-promoter acts like he’s right and everyone else is wrong. He’s be justified in acting that way if he were right. But he’s wrong at least as often. He tries to scare people into buying his books, his newsletter, and (worst of all) his high-priced “trading services”. He called for a real estate crash in 2003, a bond crash in 2004, and he’s called for a stock crash every year for the past decade.

Keep in mind when you read this book that the author was ordered to pay substantial monetary penalties to the U.S. Treasury in June 2006 for misrepresenting himself as an investment adviser when he was not registered with the Securities and Exchange Commission. It was noted in the lawsuit (UNITED STATES OF AMERICA Before the SECURITIES AND EXCHANGE COMMISSION INVESTMENT ADVISERS ACT OF 1940 Release No. 2525 / June 22, 2006 ADMINISTRATIVE PROCEEDING File No. 3-12341) that “he used selective, outdated, and/or hypothetical examples of specific returns that subscribers might have realized on individual trades had they followed Weiss Research’s recommendations, without advising that the overall return was or might not be profitable … The overall performance of Weiss Research’s premium services did not support these profit claims. In fact, during the relevant time period, many subscribers who followed each Weiss Research trading recommendation – as Weiss Research encouraged its subscribers to do – experienced overall returns that were substantially lower than Weiss Research’s profit examples and most actually lost money.”

Martin D. Wiess’ Crash Profits: Make Money When Stocks Sink and Soar! is really two books in one. On one hand it is a review-and very stinging commentary-of the shenanigans that corporate executives and Wall Street investment bankers have engaged in over the past decade that have done so much to undermine investor confidence in the markets. On the other hand it is an “investment guide for hard times” which-as all such endeavors do-assures the reader of sure fire profits in the future.
This book works much better as social commentary. Mr. Weiss is a well known, very credible and knowledgeable critic of Wall Street. Here he presents a very well constructed picture of just how the excesses of recent time came about and how they have affected investment environments. His stinging indictment of the corporate world not only effectively relates events but also provides a very detailed picture of how these events have affected the average investor’s views and outlook vis-à-vis the markets.
As an investment vehicle the book leaves much to be desired, as most of these books do. The problem is these books are aimed at the “average” investor but, like so many of its predecessors, it focuses on the wrong aspects of economic life in the middle class. It’s not that the investment advice given is particularly flawed, it’s that it fails to provide the guidance that is really needed at this point in time to really improve the economic lot of the middle class family. It talks endlessly of “investment” and virtually ignores debt, which in point of fact is the real scourge of the middle class’ economic status. The “average” middle class family has approximately $40,000 a year in family income. It also has approximately $5000 in outstanding credit card debt. With an average interest expense of 18%, the average family’s major “investment” is carrying what appears to be becoming a perpetual, high cost debt. On a long term basis, reasonable investments will generate anywhere from 5-10% in return. That’s true of Mr. Weiss’ strategies as well. Yet Mr. Weiss speaks virtually not at all to the drain debt wracks on total investment return.
If your are debt free, this makes a reasonable investment guide. If you are not, you’d be much better off buying a guide to managing debt. Regardless of you financial situation, this book is worthwhile as a historical review of the dynamics of corporate excess in the `90’s.

Given the way the economy is going, this book is a must read. There is a possibility that there will be a stock market crash in the near future: given the unfolding of the subprime mortgage crisis and untold numbers of foreclosures; banks that dabbled in hedge funds and subprime mortgages beginning to feel the pinch; the dollar spiralling downward; and the price of oil skyrocketing. Somewhere in all of this, one gets a distinct feeling of instability, and that is where Weiss’s book comes in.

His knowledge of the investing environment is refreshing and at the same time disturbing. He equips the average investor with knowledge that will help him/her in the coming difficult times. This is not a light read, yet the way he weaves story lines through the book, it places the reader comfortably into the investing environment. He gives worst-case scenarios and asks hard questions that makes the reader think. He also reveals astute insight and provides solutions to problems that help the reader feel equipped to tackle the upcoming turmoil in our economy.

The most valuable parts of the book (I think) are
where he mentions that he rates bank and brokerage firms and includes the websites. I felt as if I was reading the consumer report for banks! We actually visited a library and looked up Weiss’s bank ratings books there. They rate banks on a quarterly basis, and include a thorough list of banks in every state, their rating and safety (some banks even get A+). We checked out the banks with the higher ratings in our state.

This book provides peace of mind to the average investor trying to save and invest for the future when the economy looks dismally bleak.