Miramar, FL -- (SBWIRE) -- 07/19/2019 -- Just about every pension fund in America, every 401K, and every investment account is full of these same Bonds and Index Funds.

All of us rely on them because they've made us the richest people on planet earth over the last 40 years. This amazing success is the problem!

Let me explain. Few investors alive today, were investing forty years ago.

It's natural for any investor whose experience began after 1980 to believe that any strategy that has worked consistently for the past forty years, will work forever.

You may be surprised to learn…

In the 20 years leading to 1980, investing in the stock market was a frustrating, losing proposition.

The Dow first hit 1000 in 1964, and despite massive inflation, the Dow was only at 700 in 1980 - a full 16 years later!

Corporate bonds also consistently lost money prior to 1980.

Smart investors avoided them like the plague!

Everything changed in 1980. At that time, 15% bond yields were shocking investors, and the economy was near collapse.

But starting in 1980, with the election of Ronald Reagan and the advent of Art Laffer's Supply Side Economic Policy… Interest rates started to fall from double digits. Stock prices began to recover, starting at 700 on the Dow.

The economy, the bond market and the stock market were consistently kind to investors for the next 40 years. That's right – 40 years.

Of course, markets fluctuate. It wasn't a straight trip up.

But over that forty years, the Dow soared from 700 to 26,000.

Bond Interest rates fell from 15% all the way to near zero, and bonds were even more profitable than stocks.

Now every investor believes safe investing means bonds.

Instead of risking investment in companies, you lend them your money. You're paid interest twice a year, and your principle is repaid at maturity. What could go wrong?

So for 40 years corporate and municipal bonds have meant a safe harbor for investors.

In fact, we are all taught that the older you get, the more bonds you should own.

This is the greatest danger our economy faces today.

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