Stephen Leeb - Red Alert: How Chinas Growing Prosperity Threatens the American Way of Life

In accordance with the U.S. Copyright Act of 1976, the scanning, uploading, and electronic sharing of any part of this book without the permission of the publisher constitute unlawful piracy and theft of the authors intellectual property. If you would like to use material from the book (other than for review purposes), prior written permission must be obtained by contacting the publisher at permissions@hbgusa.com. Thank you for your support of the authors rights.

To receive special offers, bonus content, and news about our latest e-books and apps, sign up for our newsletter.

Sign Up

Or visit us at hachettebookgroup.com/newsletters

This publication is designed to provide competent and reliable information regarding the subject matter covered. However, it is sold with the understanding that the author and publisher are not engaged in rendering legal, financial, or other professional advice. Laws and practices often vary from state to state and if legal or other expert assistance is required, the services of a professional should be sought. The author and publisher specifically disclaim any liability that is incurred from the use or application of the contents of this book.

Copyright 2011 by Stephen Leeb and Gregory Dorsey

All rights reserved. In accordance with the U.S. Copyright Act of 1976, the scanning, uploading, and electronic sharing of any part of this book without the permission of the publisher constitute unlawful piracy and theft of the authors intellectual property. If you would like to use material from the book (other than for review purposes), prior written permission must be obtained by contacting the publisher at permissions@hbgusa.com. Thank you for your support of the authors rights.

Business Plus

Hachette Book Group

237 Park Avenue, New York, NY 10017

www.hachettebookgroup.com

www.twitter.com/grandcentralpub

Second e-book edition: October 2012

Business Plus is an imprint of Grand Central Publishing.

The Business Plus name and logo are trademarks of Hachette Book Group, Inc.

The publisher is not responsible for websites (or their content) that are not owned by the publisher.

The Hachette Speakers Bureau provides a wide range of authors for speaking events. To find out more, go to www.hachettespeakersbureau.com or call (866) 376-6591.

ISBN 978-1-60941-884-7

Stephen Leeb lays it all out in RED ALERT. Specifically, if Chinas master economic plan even only reaches partial fruition in the years to come, the Chinese will gain a gigantic advantage over the United States. Americans will be left struggling in all sorts of ways; indeed, our standard of living will be hobbled for decades.

Ian Fletcher, senior economist, Coalition for a Prosperous America, and author of Free Trade Doesnt Work

You dont need a crystal ball to see the future, you need this book. RED ALERT lives up to its title. Those who read it and heed the call will know how to prosper in the not-so-distant future.

Damon DiMarco, coauthor of My Two Chinas: The Memoir of a Chinese Counter-Revolutionary

Chinas need for natural resources is insatiable, and the growing trend is cause for great concern. RED ALERT is disturbing. It paints a dark picture of a self-interested China that looms ever larger on the global scene. To prepare yourself for what is to come, study this book.

Paul Midler, author of Poorly Made in China

Getting in on the Ground Floor: How to Make Money NowAnd from Now OnIn the New Bull Market

by Stephen Leeb with Donna Leeb

Market Timing for the Nineties: The Five Key Signals for When to Buy, Hold, and Sell

by Stephen Leeb with Roger S. Conrad

The Agile Investor: Profiting from the End of Buy and Hold

by Stephen Leeb and Roger Conrad

Defying the Market: Profiting in the Turbulent Post-Technology Market Boom

by Stephen Leeb and Donna Leeb

The Oil Factor: Protect Yourself and Profit from the Coming Energy Crisis

by Stephen Leeb and Donna Leeb

The Coming Economic Collapse: How You Can Thrive When Oil Costs $200 a Barrel

by Stephen Leeb with Glen Strathy

Game Over: How You Can Prosper in a Shattered Economy

by Stephen Leeb

To our children and grandchildren: Tim, Will, Cameron, Bridget, and Erin.

As with every book in which I have been an author, my wife, Donna, has played an essential role. In Red Alert, Donna made critical contributions to the outline of the book and the structure and content of the preface and first two chapters. Much thanks also goes to Michael and Alexander Poukchanski. Michael has been my chess coach and friend for more than a decade. His insights and deep understanding of chess contributed enormously to my understanding of the limits of computer intelligence and the limits of technology in general. Alexander and Michael are largely responsible for my limited but I think important understanding of Russia. Special thanks go to Patrick DeSouza, whose counsel, both as a colleague and friend, was invaluable. Our thanks to Eveline Chao for her input on daily life in China.

We also want to thank our agent, Al Zuckerman, who was ceaselessly encouraging and insightful about our proposal and many chapters. We are indebted as well to our editor, Rick Wolff, for his guidance and judicious comments, which immensely refined the finished product. We are most appreciative of the efforts of the entire Business Plus team, including Mari Okuda, Roland Ottewell, Meredith Haggerty, and Jen Musico. In addition, Genia Turanova, David Sandell, and Scott Chan, as well as other colleagues at Leeb Group, were a vital source of encouragement and ideas. And thanks to Ray Holland for making what might otherwise be arcane charts infinitely lucid.

The Prussian chancellor Otto von Bismarck once commented sagely that a statesman is a politician who thinks of his grandchildren. This brilliant nineteenth-century architect of German unification was hardly an unblemished character, but he was an extraordinary strategic thinker and on this point he was right: True national leadership is more than a tactical exercise; it requires a long-term plan. In the West today we have no plan as to how to secure or develop the resources that are the lifeblood of our prosperity, whereas in the East (and particularly China) they do have such a plan. That premise, and the implications that flow from it, are the essence of Red Alert.

An avid admirer of Stephen Leebs work, I believe that the thesis of Red Alert must be taken seriously. I have great reason to urge the reader to do so. To my mind, Stephen is one of the greatest long-term strategists of his generation. This is not puffery. Simply put, I have been a beneficiary of his wisdom in ways that have benefited both my mind and my pocketbook: His insights have been a critical component for me in the creation of not merely one, but several successful businesses. His counsel over the years regarding the trajectory of silver, platinum group metals, oil and gas, copper, and the other resources on which I have built my career has, to put it bluntly, helped me make money. In some cases, he has reinforced my own strong convictions, as with hydrocarbons and gold. In others, he has added whole new dimensions to my thinking, such as with copper and, most recently, silver. Stephens perspectives and knowledge have been incredibly valuable, and I have been privileged to have access to them.