There's a lot being written about the Greek debt crisis right now. It's scary, it's problematic, and, for the most part, almost totally unusable for the average investor.
That's completely unacceptable as far as I'm concerned.
So I thought we'd take a good hard look at what you actually need to know, then move on to three tactics that can help you capitalize on the situation. And I don't just mean by single digits, either.
The last time we saw this crisis-driven setup, savvy investors who followed along had the opportunity to take home returns of at least 245% by jumping a stock that would thrive under the circumstances.
Here's what you really need to know.
Greek Debt Crisis Headlines Add to Horror AND Set Up Your Opportunity
There's no doubt the headlines are scary. I took a quick spin across the Internet a few moments ago and this is just a fraction of what popped up:
- Europe Is Urged to Prepare for Greek Default as Stances Harden on Debt Deal – The New York Times
- Greece on "Brink of Disaster" as Talks Fail Yet Again – CNBC.com
- Greece Crisis: PM Blasts "Criminal IMF" in Defiant Speech – The Guardian
Blah, blah, blah.
Keep in mind that the mainstream media's real job is to sell sensationalism and that the Internet simply exacerbates the situation by creating a digital feeding frenzy of sorts.
A little perspective goes a long way, especially now.
Consider: Apple's valuation of $735 billion is more than triple Greece's entire annual GDP of approximately $240 billion. Exxon brings in 10 times more cash in revenue than the Greek economy creates in a year. Letting Greece go would be for the EU what letting the Florida Keys go bankrupt would be for America's $17 trillion economy – an unpleasant hit for anybody who lives there, but by no means a game changer in the long term.
Second, the ECB has been preparing for exactly this contingency for months, despite the fact that politicians have been jawboning about solutions and agreements incessantly. Chances are they've done their homework at this point.
The European Stability Mechanism intended to backstop a Greek default is in place. Whether Greece leaves or gets kicked out really doesn't matter at this point. The country lied about its finances to get in, terribly mismanaged things along the way, and, in reality, has done very little to pay back what it owes. Speaking very plainly, it's not like there's a cash spigot that's suddenly going to get turned off.
And, third, Greece is still going to be part of the EU even if it leaves the euro. That means the nation will be eligible for "balance of payment" assistance from Brussels just like Latvia and Hungary, for example.
About the Author
Keith Fitz-Gerald has been the Chief Investment Strategist for the Money Morning team since 2007. He's a seasoned market analyst with decades of experience, and a highly accurate track record. Keith regularly travels the world in search of investment opportunities others don't yet see or understand. In addition to heading The Money Map Report, Keith runs High Velocity Profits, which aims to get in, target gains, and get out clean, and he's also the founding editor of Straight Line Profits, a service devoted to revealing the "dark side" of Wall Street... In his weekly Total Wealth, Keith has broken down his 30-plus years of success into three parts: Trends, Risk Assessment, and Tactics – meaning the exact techniques for making money. Sign up is free at totalwealthresearch.com.