Published: March 1, 2010

Usually, I'm not a fan of using a single indicator to forecast where the market or economy will head next.

I say "usually" because every once and a while, I run across a single sign of what's to come that's simply too powerful to ignore -- even if other indicators don't confirm it initially. Unfortunately, I ran across one of these signals yesterday... and it doesn't bode well for the economy or the markets.

Each month, the Census Bureau reports monthly statistics on new home sales. Yesterday, the Bureau announced that new home sales for January came in at an annual rate of 309,000 -- a record low.

You can see how this number fits in by looking at the chart below. It's been a hard fall for new home sales since even before the recession started. Of course, you wouldn't expect sales to be booming given still shaky real estate prices. So why does yesterday's news stand out so much?

As I said, new home sales came in at a record low. But what I failed to mention is that there isn't any sort of adjustment for population growth in these statistics -- meaning hitting a record low now is even more startling given how many more potential home buyers there are.

The government started tracking new home sales back in the early 1963. That year, the United States had a population of 190 million. The population has grown roughly +60% to 304 million today.

So despite a surging population... record low interest rates... and even large incentives to encourage home buying... it's still not enough to keep new home sales from reaching a new all-time low.

If there were ever a sign that we're not through this downturn yet, I think this is it.

I've been doing some research on how to profit if the market takes another dip. The good news is that we just went through a bear market stemming from problems in housing, so it's not hard to know what investments are likely to work if we see another dip.

I'll be honest, the list is pretty thin (unless you short the market). I ran a screen for U.S. stocks with positive gains between September 1, 2008 and March 6, 2009 -- the time period covering the crescendo of the bear market. My results turned up blank. According to Bloomberg, not one common stock rose over that period.

But there was one set of investments that weathered the storm much better -- rebounding to their pre-crash values in just weeks.

I'm talking about exchange-traded bonds -- and if you want to profit from an impending "double-dip", this unique asset class could be your number one bet.

These gems trade on major exchanges and are issued in $25 increments. Buying these bonds is as easy as purchasing a stock.

The trick is to wait for the dip, buy the most promising exchange-traded bonds, and then watch them rebound in record time.

Just so we're on the same page, I'm not telling you to go out and buy an exchange-traded bond today so you can "lose less money" than your neighbor the next time the market crashes (which could be soon). Instead, I'm telling you that now is the perfect time to prepare yourself so you can make a quick profit AFTER that happens.

-- Tanner Callais
Staff Writer
StreetAuthority

P.S. -- I already told you the investment class to own... the only thing you need to know is which bonds to buy and WHEN to pull the trigger. We may not have a crystal ball but we've got the closest thing to it: Carla Pasternak.

During the bear market Carla hand-picked a few of these securities and urged her readers to buy them. Today they're up an average of +23.8% and paying out 8.3% yields -- four times what the S&P 500 pays. If you want these kinds of profits the next time the market takes a dip, respond to this special invitation. You'll also learn about her "Income Security of the Month" for March 2010 -- a booming oil & gas miner that has returned +177.5% in the past 52 weeks and currently pays a 10.2% dividend yield. Everything you need to know is in this special invitation.