Such performance is rare and one would think that some special insight is needed to get this type of rise. However such profits are closer at hand than it would seem if one stops for a moment to look. In this case, we can see two main reasons for the upwards explosion in last week’s USA Today.
A July 17, 2007 article in the Money section by John Waggoner is entitled “Dollar sinking against other currencies.” This article says:
“A weaker dollar gives U.S. investors a boost from profits abroad. Example: The Canadian stock market is up 11.2% in Canadian dollars (loonies) this year. But a U.S. investor in the Canadian market would have gained 24.2% after converting loonies to U.S. dollars.
“Big returns by foreign stocks have led U.S. investors to pour money into international mutual funds. The falling dollar has also benefited U.S. exporters by making U.S. goods sold abroad cheaper. In addition, large multinational companies, such as those in the Standard & Poor’s 500-stock index, derive nearly half their revenue from abroad.”
Big profits can be as simple to gain as getting out of the greenback, a tune I have been successfully touting now for long over 30 years. This has been a long playing song as the graph below suggests.
And over the last 38 years, these speculators have been wrong. Look at this chart from the Grandfather’s Economic Report Series by M W Hodges.
The US dollar has fallen dramatically since 1969. This has been a fundamental kingpin in my investing philosophy for more than three decades that has served me well.
Yet this does not explain totally why the Green Portfolio has gone so bananas!
Yes, there are forex profits in this portfolio which is leveraged with a yen loan. $100,000 was invested in that portfolio. Another $200,000 (in yen) was only $191,578.91 would be required to pay off the loan now. This shows that the yen has fallen about 4.6% versus the dollar despite the greenback’s weakness in these past nine months.
All the six shares in that portfolio are overseas, three Danish firms, one French, one German and one in Singapore. Yet there is more.
Big problems create big profits. Our weakened environment is the biggest problem of all.
Green as a trend is just beginning and this will be the largest ground swell of investment growth in markets…ever! Green is huge…important…the key to everything. We can see how green is now affecting everything in another July 17, 2007 USA Today, Money section article entitled “Tech’s green problems”.
This article tells how Dell’s new Latitude D630 laptop may be more environmentally friendly than most laptops because it doesn’t contain the lead, brominated flame retardants, polyvinyl chloride and other harmful chemicals common in PCs. This model is also not glued-together so it’s hard to recycle. It is also more energy efficient.
This article explains how previously computer makers looked for ways to create the fastest, most powerful machines and never gave thought to environmental issues. They do now.
Most computers are chemical-laden, power-sucking equipment but every major PC and electronics maker is trying to change.
The article says:
“The industry is brimming with new green initiatives. Dell in June announced a plan to become “the greenest technology company,” by beefing up its recycling program and building more Earth-friendly PCs. Weeks before, rival Apple made a similar pledge to become “greener.” Panasonic has taken the lead out of its plasma TVs. Motorola made its cellphone chargers energy-efficient. Sun Microsystems has even begun posting the amount of electricity it uses in each of its office parks, by month, on the Internet.
“Companies are motivated by customer demand as much as altruism, says Scott Martin, a marketing director at Motorola. Confidential Motorola customer surveys show a marked increase in environmental concerns, he says. (He wouldn’t provide specifics.)”
This is just the beginning. Most buyers don’t even yet consider environmental issues when buying electronics and other consumer goods beyond the automobile.
Yet this will grow and business is now aware of this fact. The article points out: “Panasonic spent six years and $75 million developing lead-free solder to connect parts inside its electronics”, says Thompson. “Lead solder is hard to duplicate because it has a relatively low melting point of about 180 degrees.” Panasonic struggled to come up with a replacement that wouldn’t melt every computer chip it touched. Toshiba is trying a hybrid program, directly recycling laptops and sponsoring take-back events in partnership with Best Buy. It’s also making products easier to recycle, recently reducing the number of screws in its TVs by 32%. Motorola has been working on power issues for years, but it wasn’t until March that all of its cellphone chargers were energy-efficient. (“Earlier attempts were too expensive or charged too slowly”, says Scott Martin, a Motorola product manager.) “Powerful computer servers need lots of electricity to process millions of bits of data each minute”, says Dave Douglas, vice president of eco responsibility for Sun Microsystems. “Sun is designing every product with power in mind. Over three years, the power bill for a single server can be higher than the cost of the computer itself. To prove its commitment, Sun now posts the monthly energy bill for its eight major campuses online.”
The article also points out that many big companies are installing green internal programs: “Being green doesn’t just mean making green products. Toshiba switched its office light bulbs to low-power fluorescents and installed a system to turn them off when not in use, saving more than $75,000 a year. Sharp has a factory with a giant solar-panel system that provides about a third of its power. Attendees at a Sun developer conference in May were e-mailed handouts, instead of receiving them on paper. About 100 trees were saved. Also, Sun’s manufacturing plant in Scotland has cut water usage by 70%.
The green tide isn’t limited to big companies. A Woodstock, Ill., PC maker, Other World Computing, is building an office building that uses environmentally friendly materials and is water- and power-efficient. NComputing in Silicon Valley specializes in PCs that can be shared, saving power. (Each user gets a separate monitor and keyboard.)”
Big problems create big profits and the two problems we see here are not odd hidden secrets buried in places no one can see.
The falling US dollar is here and has been for 40 years. Knowing this has reaped me a fortune over this time and the fall has probably not ended. I’m betting on that!
Now we have green investing. The trend has started with a bang and will be bigger than huge. What more can I say? Our first green portfolio is up 214.15% in less than nine months. Such performance speaks for itself.
You can learn why this performance has taken place in a sixteen page email report about how 13 economic forces now clash to shape investments markets ahead that show the rewards and the risks. The report also outlines the five new Multi-Currency Portfolios we are tracking in our Borrow Low-Deposit High Multi-Currency Sandwich Educational Service. Details are at https://www.garyascott.com/catalog/bldh
We update and analyze these five portfolios at our next two International Investing and Business Made EZ courses.
Join us in North Carolina, https://www.garyascott.com/nccourse
Come visit us at our Blue Ridge farm during the course. Enjoy its beauty. Here is one of the waterfalls at the entrance to the farm that one of our recent guests photographed.
One reason we love Ecuador is all its natural beauty and wonderful low cost accommodations. Here is a hostel that Steve just wrote about in our last Ecuador Living update. See how to get these updates at https://www.garyascott.com/catalog/ecrep/
We hope to serve you at one of our upcoming courses or correspondence courses.
International Business & Investing Made EZ in North Carolina.
Super Thinking + Spanish with Free Oct 1 – Mon. Andes Extension & Real Estate Tour.
Self Fulfilled – How to write and Publish for Income, Freedom and Fun.